The ringgit opened slightly lower against the US dollar on Thursday after the greenback strengthened following a hawkish outcome from the US Federal Reserve’s policy meeting, Bernama reported.
At 8am, the local currency eased to 4.0855/0910 against the US dollar from Tuesday’s close of 4.0835/0880.
The Fed raised its benchmark interest rate by 25 basis points to a target range of 3.75% to 4.00%, marking its first rate hike since 2023. The central bank’s latest projections also pointed to another quarter-point increase this year.
Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the decision was accompanied by a high degree of hawkishness, signalling the Fed’s continued focus on tightening monetary policy to achieve price stability.
“The Fed chair indicated during his press conference that the monetary policy stance is expected to be more restrictive and that they are serious about meeting one of its dual mandates, namely price stability.
“The quarterly projection by the Fed staff also showed there will be another quarter-point rate hike this year,” he told Bernama.
Mohd Afzanizam said the stronger US dollar following the decision had also been reflected in US Treasury yields, with the US dollar index (DXY) hovering at 100.322 points.
The two-year and 10-year US Treasury yields rose seven and two basis points respectively to 4.74% and 5.02%.
Against this backdrop, he expects the ringgit to remain under pressure against the US dollar, potentially trading between 4.08 and 4.10 today.
Despite its softer performance against the greenback, the ringgit opened higher against several major currencies.
It strengthened against the euro to 4.6853/6916 from 4.7111/7163 previously, while rising against the yen to 2.6182/6219 from 2.6366/6396. It also edged up against the British pound to 5.4672/4746 from 5.5037/5098.
The local currency was mixed against its ASEAN counterparts.
It strengthened against the Singapore dollar to 3.1965/2013 from 3.2093/2131 and rose against the Thai baht to 12.2265/2485 from 12.2620/2800.
However, the ringgit edged lower against the Indonesian rupiah to 230.8/231.2 from 230.7/231.1 and slipped against the Philippine peso to 6.51/6.52 from 6.50/6.51.
