KUALA LUMPUR: The ringgit had eased against the US dollar this morning, as the greenback stayed firm despite the softer United States (US) inflation print for January, said an analyst.
At 9 am, the ringgit fell to 4.3570/3620 versus the greenback from Tuesday’s close of 4.3455/3495.
A dealer said the US Consumer Price Index (CPI) rose past market expectations to 6.4 per cent year-on-year, but posted the slowest increase since 2021.
He said the softer inflation print failed to match hopes and raised concerns that it is not coming down fast enough.
The market now expects the US Federal Reserve (Fed) policymakers to stay hawkish and would be in favour of further rate hikes which would propel the US Treasury bond yields and the US dollar further.
SPI Asset Management managing director Stephen Innes said the ringgit will struggle against the backdrop of higher US Treasury yields as the market prices one additional US rate hike in June.
“Higher US yields make local bonds and other local assets less attractive, hence there is less international demand for the ringgit to buy local assets,” he told Bernama.
Meanwhile, the ringgit also traded lower against a basket of major currencies, except against the Japanese yen.
It depreciated against the Singapore dollar to 3.2794/2834 from 3.2764/2799 at Tuesday’s close and fell against the British pound to 5.3051/3112 from 5.2963/3012 yesterday.
The local currency also slipped vis-a-vis the euro to 4.6781/6835 from 4.6762/6805 on Tuesday, but appreciated versus the Japanese yen to 3.2824/2866 from 3.2918/2951 previously. – Bernama