KUALA LUMPUR: Ringgit was slightly lower against the US dollar on Thursday on weak market sentiment over a possible cut in the overnight rate (OPR) of Bank Negara Malaysia (BNM).
At 09:00 (0100 gmt), the ringgit was priced at 4.1350 / 1400 compared to 4.1320 / 1370 at close on Tuesday as the market closed on Wednesday in conjunction with Labor Day.
Kenanga Research said in its note today that credit growth continued its downward trend in March, posting a 10-month low of 4.9% growth over the previous year, compared with 5.0% in February.
"We believe the BNM now has a greater margin to reduce its MRO rate by 25 basis points, possibly at its next meeting of the Monetary Policy Committee on May 7," he said.
The research house added that the decline in loan growth was driven mainly by a slowdown in extended loans for construction, working capital and personal use, while loans for consumer durables and passenger cars continued to deteriorate.
"This indicates a high level of caution among consumers in a scenario of slower economic growth," he said.
Meanwhile, the ringgit was traded low against other major currencies.
It fell against the Singapore dollar to 3.0389 / 0430 from 3.0362 / 0410 at the close on Tuesday and depreciated against the British pound to 5.3991 / 4060 from 5.3662 / 3744.
The local currency, however, strengthened against the yen to 3.7075 / 7123 from 3.7118 / 7170, but declined against the euro to 4.6333 / 6397 from 4.6311 / 6384. – Bernama