Holds firm amid USD volatility: Tariff risks, jobs and inflation data in focus
Performance: The ringgit strengthened below the 4.40/USD threshold last Friday and held its gains this week, trading in a narrow range of 4.38-4.39. The local note benefited from a weaker USD as the USD index (DXY) fell toward 107.0, initially pressured by Trump’s remarks downplaying the likelihood of tariffs on China.
Market Dynamics: The DXY faced further downside on Monday following an AI-driven US equity sell-off triggered by DeepSeek, sparking consumer wealth concerns and dovish Fed bets. However, the Fed’s hawkish tone tempered expectations of imminent easing. The DXY regained ground on Tuesday as Trump revived his universal tariff threat, while resilient US growth and rate cuts by the ECB and Bank of Canada provided additional support.
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