Kuala Lumpur, 27 August 2025 – The ringgit ended lower against the US dollar on Wednesday, extending its recent losses as investors remained cautious ahead of the release of the US Personal Consumption Expenditures (PCE) inflation data this Friday.
At 6pm, the local currency slipped to 4.2335/2365 against the greenback, down from Tuesday’s close of 4.2160/2210.
Market Drivers
Bank Muamalat Malaysia Bhd’s chief economist, Dr Mohd Afzanizam Abdul Rashid, said the PCE data could surprise on the upside, reducing the likelihood of a US Federal Reserve rate cut in September.
“If US inflation proves to be higher than expected, it would compromise the possibility of an interest rate cut, supporting further US dollar strength,” he noted.
He also pointed out that US inflationary pressures could remain elevated following Washington’s decision to double tariffs on many imports from India to 50%.
The US Dollar Index (DXY) strengthened by 0.38% to 98.603 points, with investors seeking refuge in the greenback amid pessimistic global market sentiment and lingering concerns over the independence of the Federal Reserve.
Performance Against Major Currencies
At the close, the ringgit traded mixed against major currencies:
- Euro: Firmed to 4.9058/9093 from 4.9087/9145.
- Japanese Yen: Weakened to 2.8591/8611 from 2.8571/8607.
- British Pound: Fell to 5.6890/6930 from 5.6827/6895.
Against ASEAN currencies, the ringgit was mostly weaker:
- Singapore Dollar: Down to 3.2843/2869 from 3.2786/2828.
- Thai Baht: Fell to 13.0330/0474 from 12.9707/9917.
- Philippine Peso: Lower at 7.40/7.41 from 7.38/7.40.
- Indonesian Rupiah: Flat at 258.6/258.9.
Outlook
The ringgit is expected to remain under pressure in the near term as traders position cautiously ahead of the US inflation print. Market participants will also watch for signals on US monetary policy, with dollar demand likely to persist if inflation data reduces prospects of a September rate cut.
