Ringgit strengthens vs greenback on IMF’s positive data

KUALA LUMPUR: The ringgit continued to strengthen against the US dollar at the close today, lifted by the positive report by the International Monetary Fund (IMF) that has raised its global economic growth forecast for 2023, said an analyst.

At 6 pm, the local note gained to 4.5470/5505 against the greenback compared with 4.5615/5650 at Tuesday’s close.

The global growth forecast for 2023 was raised by 0.2 percentage points from the IMF’s previous forecast in April, putting the world economy on track for three per cent growth this year.

SPI Asset Management managing director Stephen Innes said the new forecast would be good news for Asian exporters including those in Malaysia.

He said the news should provide a better regional outlook and help alleviate economic concerns.

Other than that, Innes noted that the markets may begin to anticipate interest rate cuts as inflation continues to decrease.

“Overall, these developments are positive for the ringgit and investors may soon feel more confident in buying Malaysian assets as a result,” he told Bernama.

Meanwhile, Bank Muamalat Malaysia Bhd chief economist and social finance head Dr Mohd Afzanizam Abdul Rashid said all eyes will be on the Federal Open Market Committee (FOMC) decision on interest rates tonight.

“Any indication for a softer tone would be positive for emerging currencies including the ringgit,” he said.

Meanwhile, the local unit was traded mostly lower against a basket of major currencies.

It improved against the euro to 5.0353/0392 from 5.0368/0407 at Tuesday’s close but depreciated vis-a-vis the British pound to 5.8715/8761 from 5.8547/8592 yesterday and inched down versus the Japanese yen at 3.2402/2429 from 3.2266/2293 previously.

At the same time, the local note was traded mostly higher against other Asean currencies.

The ringgit widened versus the Singapore dollar to 3.4265/4297 from 3.4325/4354 at the close on Tuesday, expanded against the Indonesian rupiah to 302.6/303.0 from 304.0/304.5 and increased vis-a-vis the Philippine peso to 8.32/8.33 from 8.36/8.37 previously.

However, it shed against the Thai baht to 13.2747/2904 from 13.2148/2300 yesterday. – Bernama