Trump 'softens' on China tariffs, ringgit hits highest level in nearly three months
24/01/2025
At 6pm today, the ringgit rose to 4.3750/3800 against the US dollar from 4.4420/4465 yesterday. - Decorative photo
KUALA LUMPUR: The ringgit hit its highest level against the US dollar in nearly three months at the end of Friday's trading after President Donald Trump took a softer tone on the issue of Chinese tariffs and signaled his desire for lower interest rates.
At 6pm today, the ringgit rose to 4.3750/3800 against the US dollar from 4.4420/4465 yesterday.
Previously, on Nov 5, 2024, the ringgit hit a high of 4.3415/3505 against the US dollar. Global stocks and Asian currencies also rose on Friday, boosted by the prospect of tariffs on China and lower US interest rates following the US president's remarks.
Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said Trump's latest statement could drive the markets and currencies of emerging countries, including Malaysia.
"There are concerns about the implementation of tariffs on China, but now it seems that Trump's approach is softer and more pragmatic that can stimulate a more conducive international trade environment.
"The latest announcement will enable the ringgit to emerge as one of the main beneficiaries. Malaysia, for example, is a trading country and such developments can be beneficial to growth and bring better prospects for the ringgit in the future," he told Bernama.
Commenting on Trump's signal that he wants lower interest rates, he said the US Federal Reserve (Fed) and the White House should not disagree because the reality is that they are focused on the same goal.
"The Fed has been loosening its monetary policy and Trump is seeking a softer stance on monetary policy. Therefore, there is not much resistance that should be positive for US monetary policy and point to the possibility of lower interest rates," he said.
Meanwhile, at the end of today's trading, the ringgit strengthened against the world's major currencies, rising against the Japanese yen to 2.8115/8149 from 2.8429/8461, up against the euro to 4.5911/5964 from 4.6246/6293 and higher against the British pound to 5.4373/4435 from 5.4703/4759.
In addition, the ringgit also traded stronger against ASEAN currencies.
It rose against the Indonesian rupiah to 270.5/270.9 from 272.7/273.1, strengthened against the Philippine peso to 7.50/7.51 from 7.57/7.58 and strengthened against the Thai baht to 13.0015/0241 from 13.0582/0779.
The ringgit also strengthened against the Singapore dollar to 3.2482/2522 from 3.2734/2770.
