Ringgit extends losses, opens lower vs the US dollar

Investors are seeking for the safe haven currency on the possibility of another rate hike by the Fed

THE ringgit opened lower against the US dollar today, extending its losses last week as more investors shift their focus toward the safe haven currency on the possibility of another rate hike by the US Federal Reserve (Fed), dealers said.

At 9.15am, the local currency stood at 4.4830/4860 against the greenback from last Friday’s close of 4.4760/4795.

In a note today, MIDF Research said the ringgit had depreciated by 0.7% to RM4.478 week-on-week last Friday, although the decline was not as sharp compared to other major and regional currencies.

“Recent policy easing by the People’s Bank of China, and to a certain extent, slow growth in China also led to the depreciation in ringgit and regional currencies,” it said.

MIDF Research noted that the minutes of the Federal Open Market Committee (FOMC) meeting on July 22 signalled that the Fed remained committed to bringing down inflation towards its long-term 2% inflation target.

“Latest comments from Fed policymakers also indicated that another large rate hike may be considered at the next FOMC meeting on Sep 22, 2022,” it added.

Meanwhile, the ringgit was traded higher against a basket of major currencies.

The local note rose against the euro to 4.4951/4981 from 4.5069/5104 at last Friday’s close and increased against the British pound to 5.1949/1984 from 5.3126/3167 previously.

It had also improved vis-a-vis the Japanese yen to 3.2642/2666 from 3.2767/2795 on last Friday and appreciated against the Singapore dollar to 3.2152/2178 from 3.2225/2254 previously. — Bernama / pic TMR