Seen edging closer to 4.10/USD ahead of December FOMC as USD momentum softens
Performance: In line with our expectation, the ringgit traded mostly within the 4.12–4.13 band before firming to 4.11/USD on Thursday.
Market Dynamics: The DXY initially hovered around 99.5 as investors hesitated to fully price the Fed’s dovish shift. Some safehaven flows also offered support. The tone shifted after a JGB selloff, sparked by Ueda’s hawkish comments, revived expectations of a December hike in Japan and pushed funds back into the yen. Sentiment toward the USD weakened further as the likelihood rose that Kevin Hassett, a known dove, could become the next Fed chair. Softer ADP payrolls and December’s weak seasonal pattern then pushed the DXY below 99.0 and lifted the ringgit.
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