![]() With China as the country’s largest trading partner, it is natural for the ringgit to stay competitive by following the movement of the yuan. ![]() He added the weakening of the ringgit was also in tandem with the movement of the Chinese yuan which is weakening due to the slow growth of China’s economy. “Currently, if investors were to put their money in US short-term rates, I could earn a 5.6% interest rate, as opposed to 4% with the ringgit,” he said. “This situation arises because there is a positive carry when switching to the US dollar, earning US dollar at a 5.6% rate, that can be funded with the ringgit at a 4% rate. Tradeview Capital chief investment officer Nixon Wong said the weakening of the ringgit had mostly been due to the yield spread between the United States and Malaysia. The ringgit closed fractionally lower at RM4.728 yesterday against the greenback but not before hitting a low of RM4.7352 in intraday trade as traders said the prospects of currency interventions helped ease the pressure from the mighty US dollar.ĪmBank Research noted the local unit depreciated 1.2% against the greenback in September given the Federal Reserve’s (Fed) hawkishness post-September Federal Open Market Committee outcome and despite the uptick in oil prices. PETALING JAYA: The US dollar continues to strengthen at the cost of regional currencies including the ringgit, which closed at a 11-month low yesterday leading forex traders and analysts to pin hopes on currency interventions and a recovery in Chinese data to provide relief for the local unit.
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