THE ringgit closed broadly lower against the US dollar today in tandem with other regional currencies amid an increasing bid for the greenback for safe-haven purposes pending a resolution to the US debt ceiling issue, an analyst said.

At 6pm, the local note stood at 4.5700/5750 against the greenback from yesterday’s closing of 4.5470/5515.

“The US dollar is very much in the driver’s seat right now versus the Asian currencies, and you can feel the weakness getting driven through the yuan, where the weaker China growth data is compounded by increasing geopolitical risk post-G7,” said SPI Asset Management managing director Stephen Innes.

“There was a heavy condemnation of China by G7 leaders who consider both military and cybersecurity risks.”

He said the weaker yuan bled into other parts of Asia foreign exchange, especially the ringgit, with its relatively tight correlation.

The ringgit also dipped to more than two decades low against the Singapore dollar, reaching the 3.3939-level earlier today, but paring down to 3.3920/3962 at the close against yesterday’s 3.3799/3835.

“Inflation came in surprisingly higher and that could lead the Monetary Authority of Singapore to try to re-centre the Singapore dollar stronger,” said Innes.

“While the weaker growth in China should cause Bank Negara Malaysia to pause (interest rate hike) for sure and maybe even entertain a cut by year end.”

At the close, the ringgit was traded mostly lower against a basket of major currencies.

It was almost flat vis-a-vis the British pound to 5.6577/6639 from 5.6578/6634 at the close yesterday, but eased against the euro to 4.9251/9305 from 4.9189/9238 and closed lower against the Japanese yen at 3.3006/3044 from 3.2973/3008 yesterday.

The local note was traded mostly lower against other Asean currencies.

It depreciated versus the Indonesian rupiah to 307.1/307.7 from 305.3/305.8 at yesterday’s close, went down against the Philippine pesos to 8.20/8.21 from 8.14/8.16 but improved vis-a-vis the Thai baht to 13.1712/1920 from 13.1950/2138. – Bernama, May 23, 2023.