KUALA LUMPUR: The ringgit has extended its decline against the greenback as investors shift to the US dollar due to its position as the most liquid currency in the world.
The US dollar is currently in high demand following concerns of economic downturns as Covid-19 continues to dent market sentiment, said an analyst.
As at 6pm, the ringgit was quoted at 4.4080/4120 compared with yesterday’s close of 4.3737/3844.
The ringgit has reached its lowest level since April 2017, and the local note is expected to decline even further as oil prices continue to remain under US$30 per barrel, global equities continue to plunge and emerging market currencies remain under pressure due to falling demand.
“We can see that investors are hoarding the safe-haven greenback, and the thing that makes it worse for the ringgit is that oil price has continued to fall and exports will experience a steep decline in the first quarter, depleting the nation’s income by more than 25%,” she said.
As at the time of writing, benchmark Brent Crude oil was recorded at US$27.99 per barrel.
Energy analysts believe that the worse is yet to come for the oil market as it braces for a bigger impact in April.
Meanwhile, the ringgit was traded higher against a basket of other major currencies.
It rose slightly against the Singapore dollar at 3.0425/0470 from 3.0446/0664 at Wednesday’s close, increased against the British pound at 5.0848/0923 from 5.2514/2570 and strengthened vis-a-vis the euro to 4.7759/7822 from 4.7938/8081 yesterday.
It also rose against the Japanese Yen to 4.0457/0574 from 4.0759/0898 yesterday. – March 19, 2020, Bernama
