KUALA LUMPUR: The ringgit ended the day slightly higher against the US dollar as market sentiment remained positive ahead of the release of United States inflation data. As of 6 pm, the local currency was trading at 4.6500/6535 against the greenback, a slight improvement from the previous day’s closing rate of 4.6570/6610. Analysts from Bank Muamalat Malaysia Bhd are expecting softer US inflation data from the Consumer Price Index (CPI). Dr. Mohd Afzanizam Abdul Rashid, the chief economist and social finance head, expressed the importance of tonight’s data release, stating, “Tonight is quite crucial. The main worry would be US inflation rate, whether it would defy market expectation to turn up higher than expected,” in an interview with Bernama. The consensus view among analysts is that US headline and core CPI would record slower increases in June at 3.1 per cent (May: 4.0 per cent) and 5.0 per cent (May: 5.3 per cent), respectively.
Dr. Mohd Afzanizam Abdul Rashid also highlighted Malaysia’s positive economic indicators, stating that the country’s Industrial Production Index (IPI) rebounded to 4.7 per cent in May 2023, after recording a negative 3.3 per cent the previous month. This suggests that Malaysia is well-positioned to withstand the prospects of slower global growth this year.
In domestic trading, the ringgit performed well against a basket of major currencies, strengthening against the euro to 5.1262/1300 from 5.1264/1308, and against the British pound to 6.0120/0165 from 6.0136/0187. However, it slipped against the Japanese yen to 3.3300/3327 from 3.3162/3193.
Among ASEAN currencies, the ringgit traded mostly lower. It rose against the Thai baht to 13.3173/3338 from Tuesday’s close of 13.3780/3956, but fell against the Singapore dollar to 3.4753/4782 from 3.4723/4755. Additionally, the ringgit fell against the Indonesian rupiah to 308.4/308.8 from 307.2/307.7 and eased against the Philippine peso at 8.46/8.47 from 8.42/8.43.
Overall, the ringgit closed slightly higher against the US dollar, supported by positive market sentiment ahead of the release of US inflation data. Malaysia’s positive economic indicators, including the rebound of the Industrial Production Index, further strengthen the country’s position amidst expectations of slower global growth.
Credit: The Star : Business Feed
