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By Engku Shariful Azni Engku Ab Latif
KUALA LUMPUR, June 12 (Bernama) -- The ringgit continues to strengthen against the greenback on Thursday, amid weaker United States (US) economic data, an analyst said.
At 8 am, the local currency inched up to 4.2305/2405 against the dollar versus the yesterday’s close of 4.2345/2370.
Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the US Dollar Index (DXY) slid 0.47 per cent to 98.631 points as the US inflation rate came in lower than expected.
The US Consumer Price Index (CPI) came in at 2.4 per cent in May against consensus estimates of 2.5 per cent. The core CPI print was at 2.8 per cent versus 2.9 per cent in the consensus survey.
"The short-term US Treasury fell as hope for interest rate cuts has gained momentum with the two-year yield dropping seven basis points to 3.95 per cent.
"It appears that expectations for rate cuts would be in the spotlight. The current US Federal Reserve (Fed) chairman's term ends next May. US President Donald Trump is likely to appoint a Fed chief who aligns with his agenda, that is, to prescribe further monetary easing," he told Bernama.
On that note, the DXY is likely to linger below 100 points for quite some time, which would benefit emerging market currencies, including the ringgit, he added.
Mohd Afzanizam also expects the ringgit to trade on an upward trend in the range of RM4.22 and RM4.23.
At the opening, the ringgit traded lower against a basket of major currencies.
It depreciated against the Japanese yen to 2.9344/9415 from Wednesday’s 2.9187/9207, weakened versus the British pound to 5.7399/7535 from 5.7166/7200 and fell vis-à-vis the euro to 4.8693/8808 from 4.8426/8454 previously.
Meanwhile, the local currency traded mostly lower against its ASEAN peers.
It inched up against the Indonesian rupiah to 260.1/260.8 from 260.4/260.6 at Wednesday's close and was unchanged against the Philippine peso at 7.57/7.59.
However, the local note slid versus the Singapore dollar to 3.2953/3033 from 3.2925/2947 at yesterday’s close and declined against the Thai baht to 12.9949/13.0333 from 12.9729/9870 previously.
-- BERNAMA
