KUALA LUMPUR: The ringgit opened lower against the US dollar today as the greenback continued to strengthen on cautious sentiment ahead of the US Federal Reserve’s two-day meeting, a dealer said.
At 9 am, the local currency fell to 4.4090/4130 versus the US dollar from Friday's close of 4.4000/4030.
Bank Islam Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the ringgit is expected to remain weak today as the Federal Open Market Committee (FOMC) members will likely maintain a hawkish stance when it meets on June 14 and 15.
"The FOMC meeting this week is also crucial because the Fed staff will share their latest quarterly forecast.
"So, it’s going to be a weak ringgit this week along with other regional currencies due to a stronger US dollar," he told Bernama.
Mohd Afzanizam said the expectation was mainly driven by the latest print for the US consumer price index (CPI) in May which grew by 8.6 per cent and surpassed the consensus estimates of 8.3 per cent.
The 50-basis-point increase in the Fed Fund Rate has already been priced in and it may continue in the July meeting and see another round of rate hike in the September meeting, he shared.
Meanwhile, the ringgit was traded higher against a basket of major currencies.
The local note rose against the British pound to 5.4120/4170 from Friday’s close of 5.4784/4822 and strengthened against the Singapore dollar to 3.1701/1737 from 3.1856/1880 previously.
It appreciated against the Japanese yen to 3.2667/2699 from 3.2870/2895 and rose against the euro to 4.6224/6266 from 4.6618/6650. - Bernama: