KUALA LUMPUR, Feb 2 (Bernama) -- The ringgit closed easier against the U.S. dollar as market players retreated following a speculation that the central bank may raise interest rate earlier than expected, a dealer said.
As at 5 pm, the local currency declined to 3.4170/4200 against the greenback compared to last Friday's close of 3.4060/4110.
The local market which was closed on Monday for the Federal Territory Day holiday, saw the local currency also declining due to a stronger US dollar which has been gaining strength from positive signs of recovery in the US economy.
Recently, Bank Negara Governor Tan Sri Dr Zeti Akhtar Aziz was reported saying that there was a need to look at normalising interest rates due to other risks of financial imbalances.
She said should interest rates go too low and (remain so) too long, it could result in people moving outside the formal financial system to enhance their returns on savings and result in taking higher risks without realising it and this may result in problems later on.
The ringgit, meanwhile was higher against other major currencies.
It appreciated to 2.4195/4240 against the Singapore dollar from 2.4256/4319 last Friday and rose against the Japanese yen to 3.7694/7753 from 3.7748/7820 previously.
The ringgit was also higher versus the Euro to 4.7561/7613 from last Friday's 4.7602/7679 and gained against the British pound to 5.4388/4453 from 5.5078/5173 previously
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