USDMYR Technical Analysis

The US Dollar continues to rise against the Ringgit on Tuesday and is now trading at 4.5025. Recently, the chairman of the Federal Reserve (FED) Mr. Jerome Powell reaffirmed his commitment to keeping inflation under control and using all of the Fed’s tools to maintain economic stability. He also stated that he believes that this economic tightening will have few social consequences for the lower classes. Overall, this statement reiterates the Fed’s current position on a more restrictive monetary policy. This position should still be maintained for some time as employment data remains favourable and inflation is high. The main effect is that with a systematic increase in the interest rate for the USD in the medium term, it makes public debt securities increasingly interesting for investors. If we add that US bonds are the safest in the world, this tends to create a constant flow of capital from other countries to the US and from other currencies being converted to the USD, further valuing the USD against its counterparties.