Ringgit slips to new 24-year low against US dollar

The ringgit slipped further to a fresh 24-year low against the US dollar at the opening on Wednesday, in line with lower oil prices as more investors shifted towards safe-haven assets.

At 9.05 am, the local currency slid to 4.5200/5220 against the greenback from 4.5070/5085 at yesterday’s close.

ActivTrades trader Dyogenes Rodrigues Diniz said the US consumer price index (CPI) data showed higher-than-expected inflation at 8.3%, versus the forecast of 8.1%.

“This higher reading left investors wondering about how big an interest rate hike we could see at the next Federal Reserve meeting on Sept 21.

“Prior to the release of the CPI data, the market was predicting a 0.5-0.75 increase, but now many have raised their forecast to a 0.75-1.0% hike,” he told Bernama.

Diniz said the markets had responded strongly to the data, resulting in another strong appreciation of the US dollar against other currencies.

He also noted that the oil benchmark Brent crude price fell by 0.08% to US$93.10 per barrel.

Yesterday, Finance Minister Tengku Zafrul Aziz was reported as saying that Malaysia was not experiencing an economic crisis just because the ringgit is trading at a low level against the greenback.

He said that the ringgit’s performance should be viewed holistically, not just in comparison with the US dollar, as the local note has also strengthened against other currencies.

Meanwhile, the ringgit was traded higher against a basket of major currencies.

The local unit rose against the Singapore dollar to 3.2153/2174 from Tuesday’s close of 3.2320/2333 and appreciated against the Japanese yen to 3.1282/1301 from 3.1690/1703.

It had also advanced against the British pound at 5.1989/2012 from 5.2768/2786 yesterday and increased against the euro to 4.5105/5125 from 4.5818/5833 previously.