KUALA LUMPUR (Aug 19): The ringgit extended its downtrend against the US dollar on Friday (Aug 19), opening at its lowest since January 2017, as demand for the greenback continued to surge due to positive readings of US economic health, said an analyst.
At 9am, the local currency had dipped to 4.4795/4820 against the greenback from Thursday’s close at 4.4720/4750.
ActivTrades trader Dyogenes Rodrigues Diniz said the US dollar strengthened after the announcement of better-than-expected US initial jobless claims data, which showed that the number of people who applied for unemployment benefits dipped to 250,000 versus the forecast of 265,000.
“Despite the recent flow of positive data, which painted a positive picture of the US economy, the US Federal Reserve’s meeting minutes released yesterday (Thursday) seemed to suggest that the US central bank is still not looking into slowing down the pace of interest rate hikes.
“This highlights the possibility of further appreciation of the US dollar against other currencies, and against the ringgit,” he told Bernama.
He noted that the US dollar/ringgit pairing could very well hit the 4.5000 mark.
“However, if the price manages to break below 4.4550, it could drop to 4.4000 within a few days,” Diniz added.
Meanwhile, the ringgit was traded better against a basket of major currencies.
It gained against the Singapore dollar to 3.2299/2321 from 3.2371/2397 at Thursday’s close, and improved against the euro at 4.5153/5179 from 4.5471/5502 previously.
The local unit also increased vis-a-vis the yen at 3.2877/3298 from 3.3077/3102, and rose against the pound to 5.3351/3381 from 5.3959/3995 on Thursday.-BERNAMA