The ringgit surged to a near 11-month high of RM4.58 against the US dollar, influenced by the Bank of Japan’s (BOJ) interest rate hike and anticipation of a potential Federal Reserve rate cut in September.
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Ringgit rises
Closing at 4.5885/5925, the ringgit gained 315 basis points. Mohd Sedek Jantan of UOB Kay Hian Wealth Advisors attributed this to investor confidence in Asian currencies, spurred by Japan’s economic recovery.
Dr. Mohd Afzanizam Abdul Rashid of Bank Muamalat noted that the BOJ’s rate hike and expected US rate stability could increase demand for emerging market currencies like the ringgit.
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