KUALA LUMPUR: The ringgit shows signs of recovery against the pound sterling after hitting a multi-year low earlier.
Earlier today, the local unit fell to 6.0263 but managed to make a slight comeback, reaching 6.0120. This marks the first time since May 2016 when the ringgit breached the RM6 threshold at an exchange rate of 6.0299.
In comparison, the ringgit strengthened against the US dollar at 4.6500. It also saw an upward trend against the euro at 5.1262 and the Singapore dollar at 3.4753.
The pound has emerged as one of the best-performing currencies in 2023, experiencing a more than 6% gain throughout the year.
On Wednesday, the pound reached a fresh 15-month high following a Bank of England (BoE) banking system stress test. The results revealed that the country’s major lenders possess sufficient capital to withstand a potential economic crisis. This outcome further supports the likelihood of additional BoE rate hikes in the future, as reported by Reuters.
The stress test demonstrated that Britain’s eight largest banks maintain enough capital to endure severe hypothetical shocks, even surpassing the difficulties witnessed during the global financial turmoil of 2008 which required financial assistance from British taxpayers to rescue various lenders.
In its latest attempt to manage inflation, the BoE raised rates to 5% last month.
The pound soared to as high as $1.2970, reaching its highest value since April 2022. It currently hovers just below that level, with a flat performance at $1.2923.
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Credit: The Star : News Feed
