Kuala lumpur: The ringgit ended marginally lower against the US dollar on Thursday, as investors shifted to safe-haven assets following US President Donald Trump's warning to defence contractors, an analyst said. At 6 pm, the local currency edged down to 4.0580/0650 versus the greenback from Wednesday's close of 4.0560/0610.
According to BERNAMA News Agency, IPPFA Sdn Bhd director of investment strategy and country economist, Mohd Sedek Jantan, noted that the US Dollar Index (DXY) climbed to 98.82 as investors turned to safe-haven assets after Trump warned that defence companies could be barred from paying dividends and share buybacks. He explained that the situation is triggering a sell-off in US defence stocks and lifting global equity risk premia.
Mohd Sedek further stated that the dollar was bolstered by US economic data that provided little basis for markets to anticipate another near-term US Federal Reserve rate cut. Meanwhile, he observed that stronger Brent crude oil prices offered an underlying terms-of-trade tailwind for Malaysia, being a net energy exporter. At the time of writing, Brent crude price rose 0.95 percent to US$60.53 per barrel. However, he added, this was insufficient to counterbalance the dominance of global risk-off flows and US dollar liquidity demand into the close.
At the close, the ringgit traded higher against a basket of major currencies. It appreciated versus the Japanese yen to 2.5888/5935 from 2.5920/5954 at Wednesday's close, strengthened vis- -vis the euro to 4.7389/7471 from 4.7394/7453 yesterday, and rose against the British pound to 5.4535/4630 from 5.4732/4799 previously.
The local note performed mostly better against its ASEAN peers. The ringgit inched up vis- -vis the Indonesian rupiah to 241.5/242.1 from 241.7/242.1 at Wednesday's close, climbed against the Singapore dollar to 3.1602/1659 from 3.1641/1682 yesterday, and firmed versus the Thai baht to 12.8731/9007 from 12.9630/9852. However, it fell against the Philippine peso to 6.85/6.87 from 6.83/6.84 previously.