Ringgit strengthens against greenback as US tariff concerns weigh on global markets
KUALA LUMPUR, June 12 — The ringgit continued to strengthen against the US dollar on Thursday, buoyed by a softer US Dollar Index (DXY), which declined by 0.25 per cent to 98.386 points.
Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the drop followed news that US President Donald Trump's administration plans to issue letters regarding its tariff decisions within the next two weeks.
At 6 pm, the local unit advanced to 4.2155/2245 against the greenback, from Wednesday's close of 4.2345/2370.
He said the announcement has fuelled further uncertainty over the outcome of the ongoing trade negotiations.
'Whatever the case may be, the 10 per cent universal tariff is likely to exert pressure on the US economy and risks of retaliation from other nations across the globe would accentuate the downside risks to global growth,' he told Bernama.
Emerging market currencies, including the ringgit, are benefiting from the current trend. Next week's Federal Open Market Committee (FOMC) meeting on June 17-18 will be closely monitored by the market participants, he said.
At the close, the ringgit traded lower against a basket of major currencies.
It fell against the Japanese yen to 2.9329/9394 from 2.9187/9207, weakened versus the British pound to 5.7213/7335 from 5.7166/7200 and fell vis-à-vis the euro to 4.8765/8869 from 4.8426/8454 previously.
At the same time, the local currency traded mixed against its Asean peers, rising vis-à-vis the Philippine peso to 7.55/7.57 from 7.57/7.59 and rising against the Indonesian rupiah to 259.5/260.2 from 260.4/260.6.
However, the ringgit fell versus the Singapore dollar to 3.2934/3006 from 3.2925/2947 at yesterday's close and declined against the Thai baht to 12.9828/13.0173 from 12.9729/9870 yesterday. — Bernama
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Sun
39 minutes ago
- The Sun
U.S. dollar rises as Israel-Iran conflict boosts havens
THE U.S. dollar advanced on Friday as investors rushed back into the currency and other safe-haven assets including U.S. Treasury bonds and gold after Israel launched widescale strikes against Iran, sparking Iranian retaliation. Israel said it targeted a wide range of military targets in Iran, in response to which Iran launched a barrage of drones. 'The geopolitical escalation adds another layer of uncertainty to already fragile sentiment,' said Charu Chanana, chief investment strategist at Saxo. 'The key question now is whether this marks a brief flare-up or the beginning of broader regional escalation. If tensions rise, particularly with any threat to oil supply routes, the risk-off mood could persist, keeping upward pressure on crude and haven assets.' U.S. and Iranian officials were due to hold a sixth round of talks in Oman on Sunday on Tehran's uranium enrichment programme. Israel's ambassador to the United Nations said the government's determination to strike Iranian targets was an independent decision. An index that measures the U.S. dollar against six other currencies rose 0.61% and was last at 98.28. The Japanese yen and the Swiss franc, both also considered safe-haven currencies, were steady against the dollar, after rallying about 0.5% each earlier in the day. The U.S. dollar's biggest gains were against currencies positively correlated to risk sentiment - the Aussie dollar and the New Zealand dollar - which both weakened about 1% each. The euro reversed a four-day rally to trade down 0.5% at $1.1528. Investors also snapped up U.S. Treasury bonds, sending the yield on the benchmark 10-year note down as much as 4.7 basis points at one point to a more-than-one-month low of 4.31%. Gold prices jumped 1.1% to their strongest since early May. U.S. DOLLAR SET FOR WEEKLY LOSS Friday's developments created more uncertainty for investors navigating a broad range of concerns about the outlook for global trade and inflation. Despite the day's gains, the U.S. dollar index was trading close to its lowest level since March 2022, which it hit earlier this week, as a U.S.-China trade truce offered little clarity and U.S. President Donald Trump said he would outline unilateral terms of trade with other economies in the days to come. The index is on track for a weekly decline of nearly 1%, its biggest drop in more than three weeks, and is set for losses against the yen, the Swiss franc and the euro. 'Geopolitical noise may temporarily distort the dollar downtrend and temporarily weigh on risk proxies especially heading into the weekend,' said Christopher Wong, a currency strategist at OCBC. Two inflation reports this week showed price pressures were contained, fuelling expectations of more aggressive interest rate cuts by the U.S. Federal Reserve. But tariffs could filter into prices in the coming months, analysts warned. Following Israeli strikes, crude prices jumped more than $5 a barrel on fears of supply disruptions in the oil-rich region, which could also add to price pressures. Later on Friday, investors will assess the University of Michigan's preliminary survey out of the U.S. for a look at how consumers have fared this month. Final consumer inflation reports are also expected out of Germany, France and Spain. Decisions from the Fed, the Bank of Japan and the Bank of England are expected next week that could offer investors more clarity on the path ahead for interest rates. The risk-off mood also hit cryptocurrencies on Friday. Bitcoin eased 1.5% to $104,336, while ether prices declined over 4.7% to $2,516.
The Sun
39 minutes ago
- The Sun
Stocks tumble, oil soars as Israel's strike on Iran jolts markets
TOKYO: Global stock markets dived on Friday and oil prices surged after Israel conducted a military strike on Iran, rattling investors and sparking a shift towards safe havens such as gold and the Swiss franc. The escalation in hostilities in the Middle East - a major oil-producing region - adds a fresh layer of uncertainty for financial markets at a time of heightened pressure on the global economy from U.S. President Donald Trump's aggressive and erratic trade policies. Market reaction was swift. Crude oil jumped as much as 14% at one point, with Brent futures up $5.43 at $74.79 per barrel at 0541 GMT, and WTI futures up $5.55 at $73.59 per barrel. Gold climbed as high as $3,444.06 per ounce, bringing it close to the record high of $3,500.05 from April. U.S. S&P E-mini futures slumped 1.6% and Nasdaq futures dropped 1.7%. Pan-European STOXX 50 futures tumbled 1.7%. Japan's Nikkei lost 1.1%, South Korea's KOSPI dropped 1.3% and Hong Kong's Hang Seng declined 1%. 'The geopolitical escalation adds another layer of uncertainty to already fragile sentiment,' said Charu Chanana, chief investment strategist at Saxo, adding that crude oil and safe-haven assets will remain on an upward trajectory if tensions continue to intensify. Global stock markets had been poised for a fall following an almost unbroken rally since early April that took the MSCI All-Country World index to an all-time high this week, according to Jessica Amir, a strategist at MooMoo. 'There's room for fat to be taken off the table,' she said. 'It just appears that this is the catalyst that will probably send equities down lower.' Israel said its 'preemptive strike' targeted Iranian nuclear facilities, ballistic missile factories and military commanders to prevent Tehran from building an atomic weapon. Iran had launched about 100 drones towards Israeli territory in retaliation, which Israel is working to intercept, an Israeli military spokesman said. Iranian state media confirmed on Friday the death of Iran's Revolutionary Guards Commander Hossein Salami in the strikes, with six nuclear scientists also killed. U.S. Secretary of State Marco Rubio called the Israeli offensive a 'unilateral action' and said that Washington was not involved. Tensions had been building as Trump's efforts to reach a nuclear deal with Iran appear to be deadlocked. U.S. and Iranian officials were scheduled to hold a sixth round of talks on Tehran's escalating uranium enrichment programme in Oman on Sunday. The latest flare-up in fighting in the Middle East comes as investors have been wrestling with major shifts in U.S. economic and trade policies, as Trump has shredded the playbooks that have governed international trade and the world order for decades. U.S. Treasuries were bought in the rush for safer assets, sending the yield on 10-year notes to a one-month low of 4.31%. Some traders were attracted to the dollar as a haven, with the dollar index up 0.6% to 98.277, retracing most of Thursday's sizeable decline. The Swiss franc was also in demand, but was flat against the dollar at 0.8107. Fellow safe haven the yen edged down 0.1% to 143.71 per dollar, giving up earlier gains of 0.3%. The euro sank 0.6% to $1.1521, retracing most of its 0.9% overnight jump to the highest since October 2021. Sterling skidded 0.6% to $1.3540, after marking a fresh high since February 2022 at $1.3613 early in the day. 'Traders are now on edge over the prospects of a full-blown Middle East conflict,' said Matt Simpson, a senior market analyst at City Index. 'That will keep uncertainty high and volatility elevated.'
The Sun
40 minutes ago
- The Sun
US dollar and other safe haven currencies rise as Israel strikes Iran
THE U.S. dollar advanced on Friday as investors rushed back into the currency and other safe-haven assets including U.S. Treasury bonds and gold after Israel launched widescale strikes against Iran, sparking Iranian retaliation. Israel said it targeted a wide range of military targets in Iran, in response to which Iran launched a barrage of drones. 'The geopolitical escalation adds another layer of uncertainty to already fragile sentiment,' said Charu Chanana, chief investment strategist at Saxo. 'The key question now is whether this marks a brief flare-up or the beginning of broader regional escalation. If tensions rise, particularly with any threat to oil supply routes, the risk-off mood could persist, keeping upward pressure on crude and haven assets.' U.S. and Iranian officials were due to hold a sixth round of talks in Oman on Sunday on Tehran's uranium enrichment programme. Israel's ambassador to the United Nations said the government's determination to strike Iranian targets was an independent decision. An index that measures the U.S. dollar against six other currencies rose 0.61% and was last at 98.28. The Japanese yen and the Swiss franc, both also considered safe-haven currencies, were steady against the dollar, after rallying about 0.5% each earlier in the day. The U.S. dollar's biggest gains were against currencies positively correlated to risk sentiment - the Aussie dollar and the New Zealand dollar - which both weakened about 1% each. The euro reversed a four-day rally to trade down 0.5% at $1.1528. Investors also snapped up U.S. Treasury bonds, sending the yield on the benchmark 10-year note down as much as 4.7 basis points at one point to a more-than-one-month low of 4.31%. Gold prices jumped 1.1% to their strongest since early May. U.S. DOLLAR SET FOR WEEKLY LOSS Friday's developments created more uncertainty for investors navigating a broad range of concerns about the outlook for global trade and inflation. Despite the day's gains, the U.S. dollar index was trading close to its lowest level since March 2022, which it hit earlier this week, as a U.S.-China trade truce offered little clarity and U.S. President Donald Trump said he would outline unilateral terms of trade with other economies in the days to come. The index is on track for a weekly decline of nearly 1%, its biggest drop in more than three weeks, and is set for losses against the yen, the Swiss franc and the euro. 'Geopolitical noise may temporarily distort the dollar downtrend and temporarily weigh on risk proxies especially heading into the weekend,' said Christopher Wong, a currency strategist at OCBC. Two inflation reports this week showed price pressures were contained, fuelling expectations of more aggressive interest rate cuts by the U.S. Federal Reserve. But tariffs could filter into prices in the coming months, analysts warned. Following Israeli strikes, crude prices jumped more than $5 a barrel on fears of supply disruptions in the oil-rich region, which could also add to price pressures. Later on Friday, investors will assess the University of Michigan's preliminary survey out of the U.S. for a look at how consumers have fared this month. Final consumer inflation reports are also expected out of Germany, France and Spain. Decisions from the Fed, the Bank of Japan and the Bank of England are expected next week that could offer investors more clarity on the path ahead for interest rates. The risk-off mood also hit cryptocurrencies on Friday. Bitcoin eased 1.5% to $104,336, while ether prices declined over 4.7% to $2,516.
