Ringgit Mixed as Investors Weigh BOJ Rate Hike Impact

The Malaysian ringgit opened mixed against major and ASEAN currencies on Monday as investors assessed the Bank of Japan's (BOJ) rate hike on Friday.

Last week, the BOJ raised interest rates by 0.25 per cent to 1.25 per cent, its highest level in 31 years, and marked its first hike since June.

Dr Mohd Afzanizam Abdul Rashid, chief economist at Bank Muamalat Malaysia Bhd, said the rate hike had raised concerns about the ease of unwinding the yen carry trade. He also noted that higher crude oil prices could mean that inflation would remain elevated, which might prompt the US Federal Reserve to continue raising interest rates by another 25 basis points later this year.

The ringgit inched up against the euro but fell against the Japanese yen and eased vis-a-vis the British pound. It also traded mixed against its ASEAN peers, depreciating against the Indonesian rupiah and Singapore dollar but appreciating against the Thai baht.