KUALA LUMPUR, April 4 (Bernama) -- The ringgit is expected to remain defensive versus the US dollar, trading at a range of 4.42-4.45, barring surprises, said Kenanga Investment Bank Bhd (Kenanga IB).
In its Economic Viewpoint note today, Kenanga IB said markets will closely watch Malaysia’s talks with Washington on possible tariff exemptions or reductions.
Technically, it said the ringgit-US dollar rate remains neutral, anchored near its five-day exponential moving average (EMA) at 4.436.
“The tariff backdrop should keep the pair range-bound, with initial support at 4.415 and resistance at 4.444,” it said.
Kenanga IB said the US dollar had rallied due to safe-haven demand before the anticipated tariff announcement.
“The ringgit traded defensively within the 4.43-4.45 range against the US dollar, shrugging off the impact of United States (US) President Donald Trump’s tariff announcements,” it said.
The investment bank said a brief spike above 4.48 against the greenback on “Liberation Day” proved short-lived, as the greenback softened meaningfully soon after.
“Sentiment swiftly reversed after Trump delivered tariff blow to Southeast Asia.
“Renewed concerns over US economic fragility and a sharp equity sell-off US dollar lower,” it said.
Meanwhile, regionally, the Philippine peso and the Singapore dollar outperformed due to their relatively limited exposure to the trade measures.
Kenanga IB said volatility in Asian currencies is likely to persist as markets digest the implications of Trump’s tariff regime and anticipated potential reciprocal action by the April 9 deadline.
“Focus tonight will shift to US labour market data and US Federal Reserve (Fed) chair Jerome Powell’s speech.
“Powell’s tone could prove pivotal. Any hawkish tilt may reverse recent US dollar weakness and weigh on risk assets,” it said.
Kenanga IB added that higher-than-expected inflation readings next week may also influence direction.
The Trump administration imposed sweeping reciprocal tariffs, with the White House releasing a list of roughly 100 countries and their respective tariff rates, including Malaysia.
Malaysia will face a 24 per cent reciprocal tariff by the US effective April 9.
In response, the Ministry of Investment Trade and Industry (MITI) expressed openness to engage in discussions with the US, signalling Malaysia’s pragmatic stance.
-- BERNAMA
