Ringgit opens lower against US dollar

KUALA LUMPUR: The ringgit opened lower against the US dollar, as the greenback soared after the Federal Open Market Committee (FOMC) slashed interest rates by 25 basis points.

At 9am, the ringgit stood at 4.1440/1470 from Wednesday’s 4.1250/1280.

Bank Islam Malaysia Bhd chief economist Afzanizam Abdul Rashid said the rate cut and the cautious remarks made by the Federal Reserve’s chair, Jerome Powell, seemed to have disappointed the market.

“The Fed is still sanguine about the state of the economy and therefore, the recent move was just insurance against downside risks and to help sustain the current economic expansion.

“Needless to say, the US dollar has gained more strength. And this can have a negative impact on emerging market currencies,” he told Bernama.

As such, he added, the ringgit would trade on a weaker bias against the US dollar and could linger at the current resistance level of RM4.1461.

Overall, the ringgit traded higher against a basket of major currencies.

It was stronger against the Singapore dollar at 3.0099/0132 from 3.0134/0162 on Wednesday and appreciated vis-a-vis the euro at 4.5750/5791 from 4.5969/6019.

The local currency also rose against the yen 3.7914/7952 from 3.7997/8029 and gained versus the British pound to 5.0180/0220 from 5.0189/0242 previously.