Ringgit Closes Slightly Higher On Weak Us Data

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KUALA LUMPUR: The ringgit rose marginally against the greenback today as the US Dollar Index (DXY) declined due to weaker US economic data.
Bank Muamalat Malaysia Bhd chief economist Afzanizam Rashid said the May 2024 US nonfarm payrolls (NFP) was revised downwards last week from 272,000 to 218,000, suggesting that the US labour market may not be entirely robust.
“Although the labour force participation rate was slightly higher at 62.6% in June compared with 62.5% in May, it was still lower than the 62.7% achieved during March and April this year,” he said.
At the same time, Afzanizam noted that the US is steadily witnessing an increase in the unemployment rate to 4.1% in June from 3.9% and 4% in April and May, respectively.
“Hence, the US Federal Reserve chair Jerome Powell’s testimony to the US Congress on Tuesday and Wednesday this week is quite critical as market participants would be searching for any clue of easing biases,” he told Bernama.
“In the grand scheme of things, a disinflation trend has emerged while growth appears to be softening.
“Therefore, the case to pivot towards a more accommodative monetary stance could be warranted to ensure economic growth would be supported,” he added.
Against such a backdrop, Afzanizam said the ringgit does look constructive to end the year at RM4.65.
At 6.01pm, the ringgit stood at 4.7055/4.7105 versus the US dollar compared with last Friday’s close of 4.7065/4.7110.
Meanwhile, at the close, the ringgit traded mainly higher against a basket of major currencies.
It appreciated against the Japanese yen to 2.9219/2.9252 from 2.9286/2.9315 at Friday’s close and edged up vis-a-vis the euro to 5.0923/5.0977 from 5.0953/5.1001 at the end of last week, but was easier versus the British pound at 6.0273/6.0337 from 6.0182/6.0240 previously.
The ringgit traded mainly weaker against its Asean peers.
It strengthened versus the Singapore dollar to 3.4848/3.4887 from 3.4876/3.4912 at Friday’s close.
However, the local currency eased against the Indonesian rupiah to 289.4/290 from 289.1/289.5 at the previous close, fell versus the Thai baht to 12.9268/12.9456 from 12.8646/12.8818 last Friday, and slipped against the Philippine peso to 8.05/8.06 from 8.04/8.05. - FMT

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