Kuala Lumpur: The ringgit closed slightly higher against the US dollar on Tuesday as broader macro forces kept a floor under the domestic currency despite the US tariff barrage rattling global markets. At 6 pm, the ringgit rose slightly to 4.4635/4680 from 4.4640/4680 at Monday’s close.
According to BERNAMA News Agency, SPI Asset Management managing partner Stephen Innes noted the biggest factor supporting the ringgit was rising odds for a US Federal Reserve (Fed) rate cut as cracks in the US economy grew wider. “With recent data signalling weakening US growth, markets are now leaning harder into the dovish Fed pivot narrative, offering some much-needed support to the Asia forex market. Adding to the resilience, optimism around China’s fiscal expansion ahead of tomorrow’s National People’s Congress (NPC) is keeping regional foreign exchange market sentiment afloat,” he told Bernama.
Innes further explained that the currency markets were betting on Beijing stepping up stimulus efforts, which could provide a significant boost to trade-dependent economies such as Malaysia. “For now, the ringgit remains relatively insulated, but with markets in flux and Washington-Beijing trade dynamics shifting by the day, expect plenty of two-way volatility ahead. Eyes now turn to the NPC – where Beijing’s next fiscal play could set the tone for regional forex markets in the weeks ahead,” he added.
Meanwhile, the ringgit was traded lower against major global currencies. It was broadly lower against the British pound at 5.6789/6846 from Monday’s 5.6394/6444, declined against the euro to 4.6916/6963 from 4.6586/6628, and slipped against the Japanese yen to 2.9956/9989 from 2.9683/9711.
The local currency also traded lower against ASEAN currencies. It depreciated against the Singapore dollar to 3.3203/3242 from 3.3130/3163 and eased against the Thai baht to 13.1853/2057 from 13.0576/0762. The ringgit also weakened against the Indonesian rupiah to 271.3/271.8 from 270.8/271.2 and against the Philippine peso to 7.72/7.74 from 7.71/7.72.