The Malaysian ringgit experienced a mixed trading environment this week, having surged against most key currencies before precipitously dropping. Today, the ringgit depreciated against the Philippine peso, closing at 7.68/7.69. It fell against the US dollar, closing at 4.2705/2765. It showed its resilience by firming up against the Sing dollar and the Thai baht.
The ringgit’s cross rate against the Indonesian rupiah weakened to 261.5/262.0. This is a decrease from the old rate of 260.2/260.7. Against the Singapore dollar, the ringgit has rallied 8.5 per cent. It edged up to a rate of 3.3061/3110, marking a minor improvement from last week’s rate of 3.3071/3115. In addition, it appreciated against the Thai baht, trading at 13.0000/0254 from 13.0121/0353 yesterday.
The ringgit’s performance against other currencies was equally mixed. It rose on the British pound to 5.7212/7292 from 5.7241/7308 previously. The ringgit was lower against the Japanese yen at 2.9768/9812. Only just the day before it had been at 2.9642/9679. On the other hand, it strengthened against the euro to 4.8218/8286.
Dr. Mohd Afzanizam Abdul Rashid commented on the broader implications of these trends, noting that “The DXY has been lingering below 100 points as fear over fiscal burden has resulted in traders and investors shunning the US dollar.” He added that “The recent rating downgrade by Moody’s Ratings has compounded the effect as the new US administration is pushing for a tax cut bill that could worsen the US government debt level.”
This topsy-turvy production picture is a result of continued market volatility affected by global financial markets, along with domestic economic stressors. The continued volatility of the ringgit also underscores the difficulty for traders and investors charting a course through these turbulent financial waters.
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