Latest news with #AfzanizamAbdulRashid
Free Malaysia Today
3 days ago
- Business
- Free Malaysia Today
Ringgit closes slightly lower, stays defensive despite Fed concerns
KUALA LUMPUR : The ringgit slipped 0.01% against the US dollar at the close, as the local note continued trading on the defensive today, which offered some technical comfort for the ringgit. SPI Asset Management managing partner Stephen Innes said the ringgit is under pressure mainly because of concerns that the US Federal Reserve (Fed) might keep interest rates higher for longer, as markets reassess the inflation outlook. He added that the US dollar has strengthened recently as investors are becoming less certain that the Fed will cut rates in September. Innes also said the dollar's recent bid reflected a subtle but growing shift in sentiment. 'Sticky core inflation, fuelled in part by service-sector dynamics and the slow-burn impact of tariffs, is keeping the Fed in a wait-and-see mode. 'The ringgit remains vulnerable to a temporary widening in the US-Malaysia exchange rate spread. 'This does not necessarily break the broader RM4.20-RM4.30 range, and we are still inside expected bands for now, but it does create a bias for further weakness,' he added. Meanwhile, Bank Muamalat Malaysia Bhd chief economist Afzanizam Abdul Rashid said the ringgit weakened against the US dollar in the early morning session to RM4.2575 in response to the US consumer price index (CPI), which continued to increase in June to 2.7% from 2.4% previously. 'The latest CPI print appears to give the impression that the Fed may not be inclined to cut the Fed Fund Rate in the upcoming meeting in July. 'In a nutshell, the ringgit maintained its narrow-range trade in light of the ongoing uncertainties over the US tariffs,' Afzanizam said. At 6pm, the local note traded at 4.2400/4.2490 from 4.2395/4.2440 at yesterday's close. At the close, the ringgit traded higher against a basket of major currencies. It strengthened against the British pound to 5.6786/5.6907 from yesterday's close of 5.7047/5.7107, improved against the Japanese yen to 2.8508/2.8569 compared with 2.8702/2.8734, and was up versus the euro at 4.9248/4.9352 from 4.9539/4.9591. The local note also traded higher against Asean currencies. It traded higher vis-a-vis the Singapore dollar at 3.2999/3.3071 from 3.3095/3.3133 yesterday, inched up against the Indonesian rupiah to 260.3/260.9 from 260.6/261 and strengthened versus the Philippine peso to 7.43/7.45 from 7.47/7.49. It also gained against the Thai baht to 13.0301/13.0630 from 13.0784/13.0988.
Free Malaysia Today
4 days ago
- Business
- Free Malaysia Today
Ringgit strengthens as China economic data boosts sentiment
KUALA LUMPUR : The ringgit ended higher against the US dollar at the close today as market sentiment improved on the back of better-than-expected economic data from China. News that Nvidia can resume microchip sales to China also suggested that US tariff shocks could be managed, further lifting sentiments. SPI Asset Management managing partner Stephen Innes said the ringgit 'caught a gentle tailwind' after China's second quarter gross domestic product surprised to the upside, which is a regional morale boost driven not by American demand, but by 'China's resilience in non-US export lanes'. 'It's a reminder that Asean currencies, particularly the ringgit, can still find traction when Beijing's supply engine hums and its trade compass pivots south and east rather than west,' he added. Bank Muamalat Malaysia Bhd chief economist Afzanizam Abdul Rashid agreed that external factors had driven the ringgit and other currencies to a stronger level today. At 6pm, the local note rose to 4.2395/4.2440 from Monday's close of 4.2505/4.2560. At the close, the ringgit traded higher against a basket of major currencies. It strengthened against the British pound to 5.7047/5.7107 from 5.7305/5.7379, improved against the Japanese yen to 2.8702/2.8734 from 2.8858/2.8897 and was up versus the euro at 4.9539/4.9591 from 4.9693/4.9757. The local note also trended higher against Asean currencies. It traded higher vis-à-vis the Singapore dollar at 3.3095/3.3133 from 3.3184/3.3229 yesterday, improved against the Indonesian rupiah to 260.6/261 from 261.5/262 and strengthened versus the Philippine peso to 7.47/7.49 from 7.50/7.51. It gained against the Thai baht to 13.0784/13.0988 from 13.1213/13.1439.
Free Malaysia Today
5 days ago
- Business
- Free Malaysia Today
Ringgit ends lower amid cautious market sentiment
KUALA LUMPUR : The ringgit closed weaker against the US dollar today, tracking the performance of its regional peers, as market sentiment remained extremely guarded while the foreign exchange market navigated a period of economic uncertainties. Bank Muamalat Malaysia Bhd chief economist Afzanizam Abdul Rashid said the ringgit initially appreciated against the US dollar in the morning session to RM4.2455 but later stabilised to around RM4.25 in the afternoon. 'Asian currencies were also generally weak against the US dollar,' said Afzanizam. He said the US tariffs continue to hog the limelight as the Donald Trump administration maintained its hawkish stance towards the EU and Mexico with 30% tariffs. 'At the same time, Trump's frustration with Russia over the Ukraine war suggests that the fighting could prolong. 'Trump has indicated that his administration will send Patriot missiles to Ukraine to help it defend against Russia's missile attacks,' he said. Brent crude oil is currently trading above US$70 (RM297.67) per barrel. At 6pm, the local note weakened to 4.2505/4.2560 against the greenback from last Friday's close of 4.2475/4.2525. At the close, the ringgit traded mostly higher against a basket of major currencies. It strengthened against the British pound to 5.7305/5.7379 from 5.7524/5.7592, improved against the Japanese yen to 2.8858/2.8897 from 2.8893/2.8929, but traded marginally lower versus the euro to 4.9693/4.9757 from 4.9679/4.9737. The local note also trended mostly higher against Asean currencies. The ringgit traded slightly higher vis-à-vis the Singapore dollar at 3.3184/3.3229 from 3.3186/3.3228, improved against the Indonesian rupiah to 261.5/262 from 261.8/262.3, and strengthened versus the Philippine peso at 7.50/7.51 from 7.52/7.53. However, it dropped against the Thai baht to 13.1213/13.1439 from 13.0668/13.0886 at Friday's close.
Free Malaysia Today
08-07-2025
- Business
- Free Malaysia Today
US clouds Malaysia's rate path with surprise threat of 25% tariff
At Bank Negara Malaysia's early May meeting, it dropped the previously used language that its policy stance 'remains supportive of the economy'. KUALA LUMPUR : The surprise US decision to raise its threatened tariff on Malaysia to 25% means trade will almost certainly dominate the Southeast Asian nation's interest rate decision tomorrow. Analysts were split on the rate outlook before the US raised its proposed tariff from 24% in a letter yesterday, with 12 of 23 economists surveyed by Bloomberg having expected Bank Negara Malaysia (BNM) to reduce the overnight policy rate by a quarter point to 2.75%. The rest predicted no change. 'The downside risk has become more elevated and this necessitates direct intervention from policymakers, especially the central bank,' Afzanizam Abdul Rashid, an analyst at Bank Muamalat Malaysia, said today. 'There could be a 25 basis points cut in tomorrow's meeting, and at the same time, we are not ruling out the possibility of another round of 25 basis points cut on the horizon,' he added. Malaysia, which last adjusted borrowing costs in May 2023 with a 25 basis points hike, is Southeast Asia's last holdout against interest rate cuts, and the divided economists' views reflected uncertainty over the trade outlook. Negotiators had been rushing to reach a deal with the US, with Malaysia seeking a below 10% rate on sectors critical to both economies. Yesterday, US president Donald Trump unveiled the first in a wave of promised letters to key trading partners, though he is still open to additional talks and pushed off the increased duties until at least Aug 1. Malaysia's benchmark stock index fell as much as 0.7% today, while the ringgit underperformed most of its Asian peers, even as it was little changed in late morning trade. Officials have signalled they will keep seeking a deal. 'Malaysia is committed to continuing engagement with the US towards a balanced, mutually beneficial, and comprehensive trade agreement,' the investment, trade and industry ministry said today. Policymakers had already given dovish signs. At the central bank's early May meeting, it dropped previously used language that its policy stance 'remains supportive of the economy'. It also cut the statutory reserve requirement (SRR) for banks to 1% from 2%, releasing roughly RM19 billion (US$4.5 billion) into the banking system. Similar reductions in March 2020 and November 2019 were both followed by rate cuts, though BNM said in May that the SRR is used to manage liquidity and is not a signal of its monetary policy stance. Here is what to watch out for in tomorrow's statement: Growth risks The central bank may unveil its fresh growth forecast for 2025 after officials said they would revise downward the 4.5% to 5.5% projection on tariff risks. The economy has slowed for three straight quarters. Exports contracted by 1.1% in May amid trade uncertainty, while private consumption – a key driver of growth – could be dented moving forward after the government broadened its sales and service tax effective July 1. The government is also set to reduce subsidies for the country's most popular and cheapest gasoline. Another complication is that Trump has also threatened an additional 10% tariff on any country aligning themselves with BRICS, with which Malaysia is a partner. Prime Minister Anwar Ibrahim was in Brazil over the weekend to attend the BRICS summit. Another risk is the Trump administration's plans to restrict shipments of AI chips from the likes of Nvidia Corp to Malaysia and Thailand, part of an effort to crack down on suspected semiconductor smuggling into China. Inflation outlook Inflation has remained persistently low in Malaysia, prompting the central bank to say it will come in below 3% this year – the government's initial forecast was for price pressures to average 2% to 3.5%. The plan to reduce some gasoline subsidies in the second half of the year will likely have a contained impact on price pressures given that it is set to apply only on foreigners and the country's wealthiest. Ringgit performance BNM may reiterate that the ringgit's performance is primarily driven by external factors. The currency has advanced 5.5% this year against the dollar, partly as firms repatriate overseas income on the encouragement of authorities. Still, the outlook for the currency – and economy – remains heavily dependent on any trade agreement with the US.
Free Malaysia Today
20-06-2025
- Business
- Free Malaysia Today
Ringgit opens higher amid Iran-Israel conflict
KUALA LUMPUR : The ringgit opened higher against the US dollar on Friday as investors remained cautious amid the escalating conflict in the Middle East, according to an analyst. At 8am, the local note rose to 4.2490/2700 against the greenback from yesterday's close of 4.2590/2625. Bank Muamalat Malaysia chief economist Afzanizam Abdul Rashid said market sentiment would likely be cautious as traders and investors were keeping tabs on the Israel-Iran conflict, while the US considers its response to the currency pressures.
