KUALA LUMPUR: Bursa Malaysia and the ringgit succumbed to pressure on an announcement that the US Federal Reserve (Fed) would opt for a more aggressive stand on interest rate.
Both began the day lower, with the benchmark FTSE Bursa Malaysia KLCI (FBM KLCI) starting the day 1.39 points lower at 1,481.78 from yesterday’s close of 1,483.17.
Ten minutes later, it fell another 5.42 points to settle at 1,476.36.
The ringgit also retreated, trading at 4.3955/4.4050 against the US dollar three minutes into the new day, compared with 4.3900/4.3955 at the close yesterday.
In the US, the lower inflation data is expected to weigh down on investor sentiment given the potential that it could lead to a devaluation of the greenback in the short term.
A dealer expects the Fed to raise interest rate to 4.5% from 4% currently in line with an inclination by the US authority to tighten monetary policy.