Ringgit rises as Trump tariffs spark USD sales

Ringgit rises as Trump tariffs spark USD sales
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SEOUL (March 2): Ringgit gains, with the dollar getting sold off U.S. President Donald Trump’s plan to impose tariffs on
steel and aluminum imports. * USD/MYR falls 0.3% to 3.9185 after rising 0.7% in the past three days

* Dollar rally this week stalled on caution over a possible trade war, which spurred risk-off sentiment that led to lower
UST yields and equities, says Christopher Wong, senior FX strategist at Malayan Banking Bhd. in Singapore

** Protectionism measures from the U.S. increased concerns that the situation could intensify into a trade war; still there are also many moving parts such as the ongoing bilateral talks between the U.S. and other nations

** Many trade agreements are poised to be signed this year, including Southeast Asia’s RCEP and the Trans-Pacific CPTPP; both excludes the U.S., and member participants should see trade increase and potentially steer away from USD as a common settlement currency

* The tariffs of 25% on imported steel and 10% on aluminum have raised concerns of a trade war, affecting the U.S. economy and exporters

* 10-year govt bond yield drops 1bp to 4.00%

* Malaysian crude oil Feb. OSP cut to $69.39/bbl, first reduction in 8 months, according to state-owned Petronas