KUALA LUMPUR: The ringgit ended easier against the US dollar on Monday amidst cautious market sentiments following sturdy United States (US) nonfarm payrolls (NFP) for December 2024.
At 6 pm, the ringgit slipped to 4.5080/5120 versus the greenback from last Friday’s close of 4.4945/5000.
The US NFP rose to a nine-month high of 256,000 jobs in December from 212,000 jobs recorded in November, driven by a broad-based rise in employment in most sectors, with the exception of the manufacturing segment.
Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid noted that the strong outturn in the NFP suggested that the US Federal Reserve (Fed) is likely to keep the rate steady when they reconvene on Jan 28-29.
"They may want to keep the Fed Fund Rate stable at the prevailing level to contain the risk of higher inflation,” he told Bernama.
Meanwhile, SPI Asset Management managing partner Stephen Innes said the weaker ringgit was in line with Asian currencies, largely due to the ripple effects from Friday's strong US employment data, which has led to higher US rates and a "bear steepening" in the bond market, where short-dated bonds took the biggest hit.
"This reflects a growing scepticism around the likelihood of Fed rate cuts. This scepticism could deepen if this week's US consumer price index (CPI) comes in hot.
"If the CPI data is indeed strong, it could further diminish the chances of rate cuts in the near future, adding to the pressure on the ringgit. The thought of tariffs hitting in less than two weeks is also a negative,” he told Bernama.
At the close, the ringgit was mostly firmer against other major currencies.
It rose vis-a-vis the euro to 4.5964/6004 from 4.6298/6355 last Friday and strengthened against the British pound to 5.4592/4640 against 5.5296/5364 last week, but declined versus the Japanese yen to 2.8706/8733 from 2.8461/8497 previously.
The local note had also traded higher against ASEAN currencies.
It climbed versus the Thai baht to 12.9440/9618 from 12.9824/13.0043 at the previous close and was higher vis-a-vis the Indonesian rupiah to 276.8/277.2 from 277.5/278.0 last Friday.
The ringgit also appreciated against the Singapore dollar to 3.2788/2822 compared to 3.2843/2888 last Friday and advanced versus the Philippines’ peso to 7.68/7.69 from 7.70/7.71. - Bernama
