The US Dollar was down 0.58% against the Ringgit today and is now trading at 4.4920. On Friday, the Silicon Valley Bank (SVB), the bank went bankrupt, spreading fear across the financial market. This made the Federal Reserve (FED) work intensely over the weekend with the aim of preventing the panic from spreading to other banks. The FED assured that depositors are not taking any risk and will receive their money as early as Monday. One of the explanations for the SVB break is the recent rise in USD interest rates. Now the FED faces an important dilemma between continuing to raise interest rates to contain inflation and therefore increasing the risk of more banks failing or temporarily pausing the increase in interest rates, letting inflation run wild, but giving banks more breathing space. A crisis of confidence in the banking system is something much worse than the high inflation that the US is facing at the moment and that is why many analysts say that the FED will probably choose not to raise interest rates at the next meeting on March 22nd. And it is because of this expectation that the USDMYR falls on Monday. From a technical point of view, if USDMYR falls below 4.4670, it could drop as low as 4.3650 in a few days.
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