Bank Muamalat Malaysia Bhd chief economist Afzanizam Rashid said the market is of the view that the US tariff is likely to take a toll on the US economy, which would necessitate the Federal Reserve (Fed) to reduce the Fed Fund Rate to provide support to the economy.

However, Afzanizam said the US Dollar Index (DXY) is having difficulties gaining strength as the possibilities for an interest rate cut by the Fed are gaining further traction.

“The US DXY was down 0.1% to 98.074 as the US tariffs continue to grab the news headlines,” he told Bernama.

Afzanizam said the ringgit versus the US dollar was generally in a tight range of between RM4.22 and RM4.23 during the day.

At 6pm, the local currency eased to 4.2340/4.2385 against the greenback from yesterday’s close of 4.2235/4.2305.

At the close, the ringgit ended lower against major currencies.

It fell against the yen to 2.8732/2.8765 from 2.8570/2.8619 at the close yesterday, dropped versus the British pound to 5.6596/5.6656 from 5.6160/5.6253, and the euro to 4.9411/4.9463 from 4.8929/4.9010 previously.

The ringgit also trended lower against regional peers.

It dropped against the Singapore dollar to 3.2973/3.3013 from 3.2806/3.2863, declined against the Thai baht to 13.0954/13.1146 from 13.0291/13.0567, was lower against the Indonesian rupiah at 259.9/260.3 from 258.1/258.6, and slipped against the Philippine peso to 7.42/7.44 from 7.34/7.36 previously.