Ringgit Eases Vs Greenback, Investors Shift To Safe-Haven Assets

By Durratul Ain Ahmad Fuad

KUALA LUMPUR, March 30 (Bernama) -- The ringgit eased on Monday as market players continued to shift towards safe-haven assets amid uncertainties surrounding the fallout from the ongoing conflict in West Asia, now stretching beyond a month.

At 8 am, the local currency slipped to 4.0125/4.0305 against the greenback from last Friday’s close of 4.0105/0140.

Bank Muamalat Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said the foreign exchange market is likely to be in risk-off mode as uncertainties from the impact of the US-Iran war continue to plague market sentiment.

He said the US Dollar Index (DXY) climbed toward 100.328 points, suggesting that traders and investors are seeking refuge in the US dollar. At the same time, global bond fund managers such as PIMCO and JP Morgan have sounded the alarm that bond prices would rally as the conflict could lead to slower growth.

“The central bank could be forced to cut the interest rates based on their thesis. As such, ringgit is likely to remain above the RM4.00 level in light of the risk aversion,” he told Bernama. 

Mohd Afzanizam said this week the market will be observing the United States labour market data on Nonfarm Payrolls (NFPs) on Friday.

February NFPs contracted 92,000, with consensus pencilling in 56,000 jobs to be created in the upcoming data. He said signs of softening US labour market data have become more visible.

“This is especially true when gasoline prices have gone up significantly following the war in Iran, leading to weak business and consumer sentiment.

“Ultimately, traders and investors are looking for signs of the impact from the war in Iran and how that translates into Federal Open Market Committee (FOMC) decisions going forward,” he added.

Meanwhile, the ringgit rose against the British pound to 5.3101/3340 from 5.3368/3414 at last Friday’s close, climbed vis-à-vis the euro to 4.6108/6314 from 4.6197/6237 previously, and rose versus the Japanese yen to 2.5044/5158 from 2.5084/5109 previously.

Against Asean currencies, the local unit appreciated versus the Singapore dollar to 3.1100/1244 from 3.1164/1194 on last Friday, gained versus the Thai baht to 12.1624/2255 from 12.1903/2077 previously, edged down vis-a-vis the Indonesian rupiah to 236.3/237.4 from 236.1/236.5 at the previous close. It was flat against the Philippine peso to 6.62/6.66 from 6.62/6.63 previously.

-- BERNAMA