Kuala Lumpur: The ringgit strengthened against the US dollar as the greenback softened, with the US Dollar Index (DXY) slipping 0.1 per cent to 99.0 points, despite renewed optimism over a potential breakthrough in the United States (US)-China trade talks. At 6 pm, the local currency stood at 4.2345/2370 against the dollar, slightly firmer than yesterday's close of 4.2360/2420.
According to BERNAMA News Agency, Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid noted that the local currency continues to trade range-bound, moving between 4.2322 and 4.2418. He highlighted that the renewed optimism over the trade talks failed to sustain due to the lack of information, which has led to uncertainties resurfacing.
Meanwhile, Dr Mohd Afzanizam observed that Malaysia's Industrial Production Index (IPI) grew moderately at 2.7 per cent in April. Growth in the export-oriented industries within the manufacturing sector continues to accelerate, reaching 6.4 per cent, particularly in the electrical and electronics sector. He attributed the high growth in manufacturing activities to front-loading activities among trading partners, particularly from the US.
Despite these developments, traders and investors remain cautious on the tariff front and its potential impact on the economy. At the close, the ringgit traded mostly lower against a basket of major currencies. It rose against the Japanese yen to 2.9187/9207 from Tuesday's 2.9270/9314 but weakened versus the British pound to 5.7166/7200 from 5.7152/7233 yesterday, and fell vis- -vis the euro to 4.8426/8454 from 4.8354/8422 previously.
The local currency also showed mixed performance against its ASEAN peers. It rose against the Singapore dollar to 3.2925/2947 from 3.2932/2981 at yesterday's close and increased vis- -vis the Philippine peso to 7.57/7.59 from 7.58/7.60 on Tuesday. However, the ringgit declined against the Thai baht to 12.9729/9870 from 12.9712/9955 yesterday and eased against the Indonesian rupiah to 260.4/260.6 from 260.2/260.7 previously.