KUALA LUMPUR: The ringgit ended the week easier against the greenback, alongside regional currencies, as the US producer price index (PPI) data came in higher than expected, pushing back expectations of an interest rate cut in the US in June.
Bank Muamalat Malaysia Bhd chief economist Afzanizam Rashid said that the Korean won, which depreciated by 0.91%, led the regional decline, followed by the ringgit, the Philippine peso, and the Indonesian rupiah, which lost 0.35%, 0.29% and 0.24%, respectively.
The core February US PPI held steady with a 2% year-over-year increase, surpassing expectations of 1.9%.
On a monthly basis, the report indicated a 0.3% uptick compared to the previous 0.5%, outperforming the anticipated 0.2% forecast.
Afzanizam said the US Federal Open Market Committee (FOMC) meeting on March 19-20 next week would be the main event as markets look for a clearer indication of the US interest rate outlook.
Meanwhile, SPI Asset Management managing director Stephen Innes said the hotter-than-expected February PPI print also resulted in higher US Treasury yields, prompting markets to scale back the likelihood of the US Federal Reserve cutting interest rates in June.
“Consequently, Asian foreign exchange markets traded weaker against the US dollar. This sentiment was further compounded by weaker used home sales in China, underscoring persistent property concerns,” said Innes.
At 6pm, the ringgit slid to 4.7050/4.7095 against the greenback from yesterday’s close of 4.6845/4.6878.
Meanwhile, the ringgit was traded higher against a basket of major currencies.
It increased slightly vis-a-vis the Japanese yen to 3.1637/3.1669 from 3.1691/3.1721 yesterday and rose against the British pound to 6.0003/6.0060 from 6.0021/6.0072 yesterday.
However, it weakened versus the euro to 5.1275/5.1324 from 5.1243/5.1287 previously.
The ringgit traded lower against other Asean currencies.
It dropped versus the Thai baht to 13.1480/13.1661 from 13.1470/13.1641 at yesterday’s close and depreciated against the Singapore dollar to 3.5183/3.5219 from 3.5160/3.5193 previously.Stay current – Follow FMT on WhatsApp, Google news and Telegram
The local currency slid against the Philippines peso to 8.47/8.48 compared with 8.45/8.46 yesterday and edged lower against the Indonesian rupiah to 301.5/302 from 300.5/301 at yesterday’s close.
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