Ringgit opens lower ahead of FOMC decision tonight

01 Nov 2023 10:47am
Photo for illustrative purposes only.
Photo for illustrative purposes only.

KUALA LUMPUR - The ringgit opened lower against the US dollar as financial markets eagerly awaited the United States Federal Open Market Committee (FOMC) decision later tonight.

At 9.05am, the ringgit eased to 4.7675/7720 against the greenback from Tuesday’s close of 4.7615/7655.

Bank Muamalat Malaysia Bhd chief economist and head of social finance Dr Mohd Afzanizam Abdul Rashid said most traders are waiting for the FOMC decision, with a prevailing expectation that interest rates will remain unchanged.

"The anticipation of no rate hike can be influenced by various factors, including the economic conditions, inflation trends, employment figures, and the US central bank's forward guidance. If the central bank believes that the economy is not overheating and inflation is under control, it may choose to keep interest rates unchanged to support economic growth.

"Financial markets are also closely watching the US central bank meetings and announcements signalling or indicating the direction of interest rates, as these decisions can have significant implications for various financial assets, including bonds, stocks, and currencies,” he told Bernama.

However, he expected the ringgit to remain stable at about RM4.76 to the US dollar after briefly approaching RM4.80 in mid-October.

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

The ringgit appreciated against the Japanese yen to 3.1496/1530 from 3.1588/1616 at yesterday’s close, strengthened versus the euro to 5.0397/0445 from 5.0729/0772 previously, and rose vis-a-vis the British pound to 5.7858/7913 from 5.8014/8063.

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The local note was traded mixed against other Asean currencies.

It firmed against the Singapore dollar to 3.4794/4830 from 3.4867/4902 at Tuesday’s close and increased versus the Thai baht to 13.1626/1805 from 13.2371/2544.

However, the ringgit eased vis-à-vis the Philippine peso to 8.40/8.41 from 8.39/8.40 at the previous close and edged down against the Indonesian rupiah to 300.1/300.5 from 299.7/300.1 yesterday. - BERNAMA