KUALA LUMPUR (Nov 18): The ringgit depreciated to its weakest point against the U.S. dollar so far today at 4.4150, after the U.S. Federal Reserve Chair Janet Yellen said US interest rates might rise "relatively soon".

Reuters quoted Yellen as saying incoming U.S. economic data justified a rate hike and in the absence of any dramatic changes, a gradual pace of hikes after that. Yellen's remark led to a stronger U.S. dollar, due to demand for the currency in anticipation of higher interest rates there.
 
At the time of writing, the ringgit pared losses at 4.4120, after trading between 4.3958 and 4.4150 today. Over the last one year, the exchange rate was between 3.8442 and 4.4415.

The U.S. Dollar Index, which measures the currency's value against a basket of currencies, rose to 101.25. The intraday range so far today was between 101.02 and 101.32.

The ringgit's depreciation continued despite Bank Negara Malaysia's ban on offshore non-deliverable forward (NDF) ringgit trades.

Bank Negara issued a statement last Sunday that the central bank was "taking measures to reinforce existing rules" to prohibit offshore NDF ringgit trades.

Yellen's comments and Bank Negara's statement were in anticipation of higher U.S. inflation and interest rates, due to U.S. President-elect Donald Trump's planned expansionary fiscal polices.