Ringgit appreciates against major currencies
KUALA LUMPUR: The ringgit appreciated against major currencies and held firm versus the US dollar at the close yesterday as Malaysia posted a stronger trade performance, returning to positive growth in July.
According to the Investment, Trade and Industry Ministry (Miti), the country's trade performance rebounded by 3.8% year-on-year (y-o-y) to RM265.92bil in July, the highest monthly trade value ever.
At 6pm, the local note made a marginal retreat to 4.2215/2255 against the greenback from yesterday's close of 4.2200/2240.
Miti said exports in July jumped 6.8% to RM140.45 billion, the highest monthly value since September 2022, while imports edged up by 0.6% to RM125.47bil.
Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the latest export print suggests Malaysia's external sector is still 'fairly decent' despite having to contend with US tariffs.
'Hence, the case for a strong ringgit going forward remains intact,' he told Bernama.
Meanwhile, he said market players will monitor the US Federal Reserve (Fed) meeting at the Jackson Hole Symposium later this week, with chair Jerome Powell's speech this Friday in focus.
'Traders and investors appear to lean towards a possible 25 basis points cut in September as signs of a weaker US labour market have become increasingly apparent. Hence, a dovish tilt by the Fed is something that the market wants to hear.
'Therefore, any deviation from this view could have an impact on the currency market trajectory,' he added.
At the close, the ringgit settled mostly higher against a basket of major currencies. It strengthened versus the Japanese yen to 2.8572/8601 from Monday's close of 2.8632/866, gained against the British pound to 5.7066/7120 from 5.7139/7193, but dropped vis-à-vis the euro to 4.9307/9354 from 4.9290/9336.
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