The Malaysian ringgit weakened against a stronger US dollar as easing geopolitical tensions and hawkish Federal Reserve commentary supported the greenback.
KUALA LUMPUR: The ringgit opened lower against the US dollar on Friday, pressured by external factors as receding near-term geopolitical tensions lent support to the greenback.
At 8 am, the local currency eased to 3.9510/9610 versus the US dollar from Thursday’s close of 3.9440/9535.
Media reports said the United States and Iran are scheduled to hold talks in Oman on Friday following the downing of an Iranian drone earlier this week.
READ MORE: Ringgit dips against US dollar but gains on other major currencies
IPPFA Sdn Bhd director of investment strategy Mohd Sedek Jantan said softer US labour-market data had reinforced demand for US Treasuries, pushing yields lower overnight.
“However, the absence of a clear signal of imminent Federal Reserve easing has kept the US dollar supported,” he told Bernama.
He explained that markets are pricing in a growth slowdown without a rapid policy pivot from the Fed.
This dynamic has sustained defensive dollar positioning, limiting near-term upside for the ringgit despite stable domestic macroeconomic conditions.
Separately, Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid noted Atlanta Fed president Raphael Bostic had maintained a hawkish stance.
“Hawkish views among Fed officials have supported the US dollar,” he said.
The ringgit traded mostly lower against a basket of major currencies.
It strengthened against the British pound to 5.3418/3553 from 5.3496/3625.
It weakened versus the Japanese yen to 2.5199/5265 from 2.5068/5130 and slipped against the euro to 4.6527/6645 from 4.6460/6572.
The local currency also traded lower against most ASEAN peers.
It fell against the Thai baht to 12.4074/4458 from 12.3955/4320 and edged down versus the Indonesian rupiah to 234.5/235.3 from 234.1/234.8.
The ringgit declined against the Singapore dollar to 3.0969/1052 from 3.0943/1020.
It also eased versus the Philippine peso to 6.73/6.75 from 6.72/6.74 previously. – Bernama