Bank Muamalat Malaysia Bhd chief economist Afzanizam Rashid said the latest CPI print at 1.8% for October suggests that the real rate of interest has increased, indicating the monetary policy has become increasingly restrictive.

“Therefore, the upside potential for overnight policy rate looks rather limited at this juncture although Bank Negara Malaysia (BNM) remains guarded on inflationary risks,” he told Bernama.

According to the statistics department, Malaysia’s headline inflation, as measured by the CPI, moderated to 1.8% in October 2023, the lowest since April 2021, with the CPI at 130.9 points against 128.6 in the same month a year ago.

At 6pm, the ringgit dropped to 4.6830/4.6875 against the greenback from yesterday’s close of 4.6775/4.6830.

The ringgit was traded mostly higher versus a basket of major currencies.

It appreciated against the euro at 5.1059/5.1108 from 5.1092/5.1152 yesterday, climbed versus the Japanese yen to 3.1295/3.1327 from 3.1342/3.1381 but fell vis-a-vis the British pound to 5.8767/5.8823 from 5.8740/5.8809.

The local currency traded mixed against other Asean currencies.

It inched up versus the Singapore dollar to 3.4903/3.4940 from 3.4922/3.4969 and was firmer versus the Thai baht at 13.1949/13.2139 from 13.2601/13.2813 yesterday.

However, the ringgit weakened against the Philippine peso to 8.45/8.46 from 8.44/8.46 yesterday and was flat vis-a-vis the Indonesian rupiah at 300.8/301.3 from 300.6/301.2 previously.