Ringgit expected to trade in cautious mode next week amid US tariff uncertainty

THE ringgit is likely to be traded cautiously against the US dollar next week amid ongoing uncertainties surrounding US tariff policy developments, said Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid.

This follows renewed market uncertainty after a US federal appeals court granted the White House’s request to temporarily pause a lower-court ruling that struck down President Donald Trump’s tariffs on imports into the country.

Earlier, the US Court of International Trade had ruled that the tariffs announced by Trump were illegal. However, the Trump administration challenged the ruling, which has briefly restored the tariffs while the appeal process runs its course.

Besides that, he said attention will also turn to the upcoming US Federal Reserve’s Federal Open Market Committee (FOMC) meeting scheduled for June 16-17.

“Key US economic indicators, particularly labour market data and inflation figures, will be closely watched.

“Important data releases such as nonfarm payrolls, the unemployment rate, and the Institute for Supply Management manufacturing index will serve as critical guidance for investors and traders,” he told Bernama, adding that current data suggests a moderating growth outlook.

Hence, Mohd Afzanizam said the FOMC is likely to maintain its interest rate stance, given that tariff-related policies could pose future inflationary risks.

Given these developments, he opined that the USD/MYR is expected to remain within the RM4.22–RM4.24 range in the coming week.

The ringgit ended the week lower against the US dollar, closing at 4.2530/2605 on Friday from 4.2285/2345 a week earlier.

The local note traded lower against a basket of major currencies.

The ringgit depreciated versus the euro to 4.8169/8254 at Friday’s close from 4.7985/8053 at the end of last week.

It also fell vis-à-vis the Japanese yen to 2.9531/9585 from 2.9502/9546 and inched down against the British pound to 5.7284/7385 from 5.7072/7153 a week earlier.

However, the ringgit traded mostly higher against ASEAN currencies.

The local note improved against the Philippine peso to 7.62/7.64 from 7.65/7.66 a week before, edged up against the Indonesian rupiah to 260.4/261.1 from 260.7/261.1 and strengthened versus the Thai baht to 12.9507/9790 from 12.9744/13.0012 last week.

However, it weakened versus the Singapore dollar to 3.2938/3002 on Friday from 3.2891/2940 the previous week. - May 31, 2025