Ringgit strengthens against greenback in early trade

KUALA LUMPUR: The ringgit opened higher against the US dollar today on renewed demand for the local currency coupled with the stock market recovery, an analyst said.

As of 9am, the local note rose to 4.4700/4750 against the US Dollar from last Friday’s close of 4.4765/4780.

Mohd Afzanizam Abdul Rashid, head of economics, market analysis and social finance at Bank Muamalat Malaysia Bhd, said that from a technical perspective, the ringgit is already in an oversold position against the US dollar, hinting at possible short-term appreciation.

Friday’s US labor market (NFP) data and Thursday’s meeting of Bank Negara Malaysia’s (BNM) monetary policy committee are among the key events this week, he said.

“We believe BNM is likely to leave overnight interest rates (OPR) unchanged as the central bank may need to monitor the impact of last year’s rate hikes.

“Perhaps we could have more (clarity) once BNM announces its annual report.

“For now, we believe the ringgit will continue to range in a tight range of around RM4.47 to RM4.48 against the greenback as concerns over a hawkish US Federal Reserve (Fed) will continue to dictate market direction” he said to Bernama.

The ringgit traded lower against a basket of major currencies.

The local unit weakened to 4.7507/7560 from 4.7487/7503 against the euro last Friday and slipped to 3.2904/2943 from 3.2877/2890 against the Japanese yen.

It also fell against the British pound to 5.3770/3830 from the previous 5.3642/3660 and weakened against the euro from 4.7487/7503 to 4.7507/7560.

However, the local note has mostly traded higher against ASEAN currencies.

It rose to 3.3229/3271 against the Singapore dollar from 3.3255/3269 last Friday and improved to 8.15/8.17 against the Philippine peso from 8.16/8.17.

The local currency also rose against the Indonesian rupiah to 291.9/292.4 from 292.30/292.60, but weakened against the Thai baht to 12.9183/9406 from 12.8998/9105. -Bernama