KUALA LUMPUR: The ringgit eased further today to RM4.63 against the US dollar at 4pm.
The decline follows a morning slip against the dollar, with investors anxiously awaiting more information on the United States interest rate outlook.
At 9am this morning, the ringgit fell to 4.6205/6250 against the greenback, marking a significant drop from Tuesday's closing of 4.6035/6080.
The weakening of the local currency is largely attributed to the uncertainty surrounding the US interest rate, a crucial factor influencing global currency markets.
SPI Asset Management managing director Stephen Innes said the depreciation is a result of a combination of waning expectations for a US interest rate cut, pushing US yields higher.
"Locally, there is still a lingering hangover from weaker China Purchasing Managers' Index (PMI) data that was released over the weekend. But markets will get busy as US macro data gets culminating in Non-farm Payroll (NFP) Friday which is the major event this week for foreign exchange markets," he told Business Times.
Innes added that a weaker print will support a March Fed rate cut and support and weaken the US dollar.
"Of course, there are concerns of a stronger print that could lend support for the US dollar. So, part of what we are seeing is position squaring as we enter the busy part of the US macro data releases," he said.
Bank Muamalat Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said markets are awaiting the Federal Open Market Committee minutes, which will be released tomorrow, to gather further conviction over a rate cut in 2024.
"Given that the ringgit is already at an overbought condition at the current juncture, we can expect some technical correction," he told Bernama.
He noted that the US Dollar Index climbed to 102 points despite the weak Manufacturing Purchasing Managers' Index for the US, which came in at 47.9 points in December versus consensus estimate of 48.2 points.
Nonetheless, the local note generally gained ground against a range of major currencies today.
However, the ringgit was traded lower against Asean currencies.