Ringgit Rises As US Govt Shutdown Fears Weigh On Dollar
Reports indicated that the federal government is on the brink of a shutdown unless the US Congress can reach a funding agreement before the start of the new fiscal year on October 1.
KUALA LUMPUR, Sep 29 – The ringgit ended higher against the US dollar today as concerns over a potential US government shutdown weighed on the greenback, an analyst said.
Reports indicated that the federal government is on the brink of a shutdown unless the US Congress can reach a funding agreement before the start of the new fiscal year on October 1.
Bank Muamalat Malaysia Bhd chief economist Afzanizam Rashid said a US government shutdown would mean limited services, which, if prolonged, could undermine economic growth.
“The US Congress needs to agree on the spending programme by the end of September to avoid a government shutdown.
“Hence, the thesis for US interest rate cuts has gained momentum from such an event, resulting in a weaker US dollar,” he told Bernama today.
At 6pm, the local note rose to 4.2150/4.2200 against the greenback compared with Friday’s close at 4.2200/4.2250.
At the close, however, the ringgit was lower against a basket of major currencies.
It eased to 2.8365/2.8400 against the Japanese yen from 2.8171/2.8206 at Friday’s close, slipped to 5.6612/5.6679 against the British pound from 5.6345/5.6412, and declined to 4.9387/4.9446 versus the euro from 4.9281/4.9340.
The local note was mostly lower against Asean currencies.
It fell to 3.2664/3.2706 vis-à-vis the Singapore dollar from 3.2630/3.2671 and depreciated to 13.0649/13.0857 against the Thai baht from 13.0587/13.1069 previously.
The ringgit also edged lower against the Indonesian rupiah at 252.6/253.1 from 252.1/252.5, and was flat versus the Philippine peso at 7.25/7.26 from 7.25/7.27 previously. – Bernama
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