Ringgit Bounces To Fresh 14-month High As US Dollar Weakens On Expected Rate Cut

By Zufazlin Baharuddin

KUALA LUMPUR, Dec 3 (Bernama) -- The ringgit jumped to a fresh 14-month high against the greenback on Wednesday, hitting 4.1200 at the close as the continued anticipation of an interest rate cut by the US Federal Reserve (Fed) next week weighed on the dollar.

At 6 pm, the ringgit advanced to 4.1200/1235 versus the greenback compared to Tuesday’s close of 4.1275/1330.

The local currency beat the previous high recorded on Sept 30, 2024, when it closed at 4.1210 against the greenback.

Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the expectation of an interest rate cut by the Fed next week has clearly resulted in a stronger ringgit as the decision will narrow the gap in the rate differential between the Fed funds rate and Malaysia’s overnight policy rate.

“Based on the interest rate futures contract, the probability of an (US) interest rate cut next week has gone up to more than 90 per cent at the moment,” he told Bernama.

At the close, the ringgit trended lower against major currencies.

It fell versus the British pound to 5.4697/4744 from 5.4524/4597 at Tuesday’s close, slid against the euro to 4.7982/8022 from 4.7920/7984, and edged down vis-à-vis the Japanese yen to 2.6476/6501 from 2.6463/6500.

However, the local note traded mostly higher against ASEAN currencies.

It gained versus the Singapore dollar to 3.1810/1839 from 3.1816/1861 at Tuesday’s close, climbed against the Indonesian rupiah to 247.7/248.1 from 248.2/248.7, and was higher against the Philippine peso at 6.99/7.00 from 7.05/7.06 yesterday.

The ringgit, however, dipped vis-à-vis the Thai baht to 12.9024/9186 from 12.8928/9164 previously.

-- BERNAMA