Ringgit gains after US court pauses block on Trump's tariffs
KUALA LUMPUR : The ringgit opened stronger against the US dollar today, boosted by improved investor confidence in emerging market currencies after a US court temporarily halted a decision to block most Trump-era import tariffs, an analyst said.
At 8am, the local note surged to 4.2180/4.2485 versus the greenback from Thursday's close of 4.2390/4.2475.
Bank Muamalat Malaysia Bhd chief economist Afzanizam Rashid said the US Dollar Index (DXY) fell below the 100-point mark to 99.278 points after the US court of appeals for the federal circuit granted a reprieve from a US court of international trade ruling that would have blocked most Trump-era import tariffs on Wednesday (US time).
Additionally, he said US economic data look weaker with Initial Jobless Claims rising more than expected to 240,000 last week against consensus estimates of 229,000 while the Continuous Jobless Claims accelerated to 1.91 million for the week ending May 17 from 1.89 million in the prior week.
'Apart from that, the second estimate for the first quarter of 2025 US gross domestic product (GDP) contracted 0.2% quarter-on-quarter seasonally adjusted annualised rate (SAAR), slightly better than the first estimate of -0.3% but lower than the 2.4% expansion in the previous quarter.
'It appears that the US dollar weakening trend is likely to continue today, benefiting the ringgit,' he added.
Afzanizam said traders and investors will be looking at Personal Consumption Expenditure (PCE) inflation data. Consensus is pencilling the headline PCE and Core PCE at a moderate pace of 2.2% and 2.5% in April against 2.3% and 2.6% in the prior month.
Therefore, the ringgit is expected to trend higher today, possibly around RM4.21 and RM4.22, owing to a weaker US dollar outlook, he added.
At the opening, the ringgit traded mostly higher against a basket of major currencies.
It is appreciated against the British pound to 5.6943/5.7355 from 5.7091/5.7205 from Thursday's close and gained vis-à-vis the euro to 4.7992/4.8339 from 4.7803/4.7899 previously.
However, the local note declined against the Japanese yen to 2.9349/2.9563 from yesterday's close of 2.9188/2.9249.
The local note was traded mostly higher against its Asean peers.
It improved against the Singapore dollar to 3.2789/3.3031 from 3.2853/3.2921 on Thursday's close and inched up versus the Indonesian rupiah to 258.6/260.6 from 259.9/260.5 previously.
The ringgit advanced vis-à-vis the Philippine peso at 7.56/7.62 from 7.60/7.62 at yesterday's close, but slid against the Thai baht to 12.9565/13.0590 from 12.9321/12.9647 previously.
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