Ringgit closes marginally lower against US dollar ahead of Fed meeting

KUALA LUMPUR: The ringgit closed marginally lower against the US dollar on Tuesday as the greenback stayed firm ahead of the US Federal Reserve (Fed) meeting today and tomorrow.

At 6 pm, the ringgit was lower at 4.7700/7750 versus the greenback from Monday’s close of 4.7650/7700.

Bank Muamalat Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said the US Dollar Index (DXY) gained some ground today to 105.896 points as markets await the Fed’s Federal Open Market Committee (FOMC) meeting which will commence later tonight and tomorrow.

“Yen versus the greenback is also down 0.34 per cent to 156.88 points. The ringgit held up quite well, especially in the morning session where the USD/MYR went to as low as RM4.7665 before settling at RM4.7715 during the afternoon session.

“Markets remain jittery over the FOMC meeting with calls for a rate cut appearing to have (faded) given that the US inflation rate has been very sticky, along with hawkish assessments by Fed officials,” he told BK.

This, he said, will continue to support the strong dollar view in the near term, especially when other major economies are contemplating cutting rates.

At the close, the ringgit was traded mostly lower against a basket of major currencies.

It rose versus the Japanese yen to 3.0396/0430 from 3.0588/0624 at Monday’s close and slipped vis-a-vis the British pound to 5.9835/9898 from 5.9710/9773 previously. However, it fell against the euro to 5.1163/1217 from 5.1052/1106.

At the same time, the local note was traded mostly lower against Asean currencies.

It depreciated versus the Thai baht to 12.8689/8869 from 12.8669/8853 on Monday and inched down vis-a-vis the Indonesian rupiah to 293.3/293.8 from 293.1/293.5 previously. However, it strengthened against the Philippine peso to 8.25/8.27 from 8.26/8.27 last week and fell versus the Singapore dollar to 3.5045/5084 from 3.5039/5081. – BK