THE ringgit continued to slide against the US dollar in the early session today as the local currency remained in an overbought position ahead of an expected rise in US interest rates in May, said an analyst.

At 9.18am, the local note was pegged at 4.4350/4380 versus the greenback from yesterday’s close of 4.4200/4250.

Bank Muamalat Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said the ringgit would likely stay weak today, possibly around RM4.42 to RM4.43 versus the greenback, as technical indicators showed the ringgit was in an overbought condition.

“The current resistance level is located at RM4.4236, and the US dollar/ringgit might linger within such a level,” he told Bernama.

Afzanizam said US Treasury yields were higher with the interest rate-sensitive two-year yield, rising more than nine basis points to 4.19%, anticipating the US Federal Reserve (Fed) will resume tightening interest rates in May when it next meets.

“Similarly, the US dollar gauge, the US Dollar Index (DXY), went up by 0.54% to 102.103 points. Such trends resonate with talk from several Fed officials who continue to suggest a restrictive monetary stance is here to stay,” he said.

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

It eased slightly against the Japanese yen to 3.2974/3001 from 3.2968/3008 at the close yesterday, advanced to 4.8448/8481 from 4.8532/8587 vis-a-vis the euro, and dropped against the British pound to 5.4861/4898 from 5.4808/4870 yesterday.

The local note traded mostly lower against Asean currencies with the exception of the Philippines’ peso, which stood flat at 7.91/7.92 from yesterday’s 7.91/7.93.

It fell against the Indonesian rupiah fell to 299.7/300.1 from 298.7/299.2, was slightly lower against the Thai baht at 12.8607/8750 from 12.8604/8813, and declined against the Singapore dollar to 3.3233/3258 from 3.3196/3238 yesterday. – Bernama, April 18, 2023.