KUALA LUMPUR – The ringgit continued its downtrend against the US dollar today, as risk aversion sets in global markets due to Covid-19 fears, said Axi chief global market strategist, Stephen Innes.
At 6pm, the local currency declined to 4.1640/1680 versus the greenback, compared with 4.1630/1670 at Monday’s close.
He said the uncertainty surrounding the upcoming United States presidential elections is also seeping into the Asian foreign exchange markets.
The situation is further exacerbated by news reports stating that China would sanction three American defense contractors over proposed arms sales to Taiwan, retaliating against US efforts to deepen security ties with the island democracy that Beijing claims as its territory.
However, on the domestic front, the main concern for the ringgit is falling oil prices.
“This is especially as market focus turns to Budget 2021, as oil revenues are a necessary support for the government coffers.
“It looks like investors want to reduce riskier asset before the US elections next week,” Innes said to Bernama.
Meanwhile, the ringgit was traded mixed against other major currencies.
It had marginally increased against the Singapore dollar to 3.0595/0636 from Monday’s close of 3.0604/0644, and rose against the British pound to 5.4224/4288 from 5.4319/4392.
However, the local note fell against the yen to 3.9801/9847 from 3.9689/9739 and slipped versus the euro to 4.9169/9220 from 4.9157/9221 yesterday. – Bernama, October 27, 2020
.jpeg)
