Ringgit closes lower on firmer demand for greenback

KUALA LUMPUR: The ringgit ended lower against the US dollar on firmer demand for the greenback, as investors sought the safe-haven currency amid worries over worsening global economic outlook due to the Covid-19 pandemic.

At 6 pm, the ringgit was traded lower at 4.3520/3620 against the US dollar compared with Thursday’s close of 4.3480/3550.

An analyst said that last week’s US initial jobless claims, which reached 6.65 million following the coronavirus impact to employment, has driven investors to seek shelter in the greenback.

Meanwhile, FXTM market analyst Han Tan said the positive surprises in Malaysia’s February 2020 external trade figures, with exports and imports showing year-on-year gains of 11.8% and 11.3% respectively, should cushion the ringgit from further depreciating.

“The risk of Malaysia’s economy contracting by up to2% cent in 2020, according to Bank Negara Malaysia’s revised gross domestic product (GDP) forecast, may feed into the overall upside bias for the US dollar-ringgit for the rest of the year.

“However, with adequate monetary policy buffers, more supportive measures could be rolled out to mitigate Covid-19’s negative impact on the domestic economy,” he added.

Despite weakening against the greenback, the ringgit traded higher against a basket of major currencies.

The local unit rose versus the Japanese yen to 4.0118/0221 from 4.0518/0591 at Thursday’s close and appreciated against the Singapore dollar to 3.0319/0399 from 3.0395/0457.

It improved vis-a-vis the euro to 4.7049/7175 compared to the 4.7537/7631 and strengthened against the British pound to 5.3495/4631 from 5.4180/4285 yesterday. – April 3, 2020, Bernama

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