Ringgit opens lower against US$ as tensions rise in Yemen

KUALA LUMPUR: The ringgit opened lower against the US dollar on Monday as foreign exchange markets focused on geopolitical tensions in light of the United States (US) and its allies’ recent military attack in Yemen.

At 9.07 am, the ringgit depreciated to 4.6470/6570 versus the greenback from Friday’s close of 4.6455/6500.

Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the attack has resulted in crude oil prices being at elevated levels, with Brent crude rising to US$78.17 per barrel from US$76.8 per barrel before the attack on Thursday last week.

“The two-year US Treasury yield was also down by 10 basis points to 4.14 per cent while the interest rate derivatives market have been upping their bets for US Federal Reserve rate cut in March,” he told BK.

Mohd Afzanizam said the market seems to be in a risk-off mode due to uncertainties caused by the conflict in Yemen.

As such, he expects the ringgit to remain soft at around RM4.64 to RM4.65 per US dollar.

Meanwhile, the ringgit was traded mostly higher against a basket of major currencies.

It strengthened versus the euro to 5.0903/1013 from 5.0924/0973 on Friday and appreciated vis-a-vis the British pound to 5.9189/9316 from 5.9239/9297 previously, but decreased against the Japanese yen to 3.2024/2095 from 3.2007/2040.

At the same time, the ringgit traded mostly lower against Asean currencies.

The local note increased against the Singapore dollar to 3.4887/4968 from 3.4900/4936 at Friday’s close, but eased versus the Indonesian rupiah to 298.7/299.6 from 298.6/299.1 last week, slid against the Thai baht to 13.2980/3324 from 13.2464/2664, and fell vis-à-vis the Philippines’ peso to 8.32/8.34 from 8.30/8.32 previously.

— BK

TAGS: Ringgit, Afzanizam Abdul Rashid, US Treasury, geopolitical tensions