Ringgit opens flat vs US dollar
Ringgit opens flat vs US dollar

Ringgit opens flat vs US dollar

KUALA LUMPUR: The ringgit opened little changed against the US dollar this morning as sentiments were mixed in light of the United States’ (US) thriving economy and China’s wobbling economy, said an analyst.

At 9 am, the local note slightly rose to 4.6460/6500 against the greenback from 4.6465/6510 at last Friday’s close.

SPI Asset Management managing director Stephen Innes said although these factors could have varying effects on other assets, they usually help strengthen the US dollar in the foreign exchange (forex) market.

“I anticipate that these themes will continue to remain dominant. However, as the US Federal Reserve (Fed) chair Jerome Powell is set to deliver a speech at Jackson Hole on Friday, I believe the market may experience range-bound trading,” he told BK.

Additionally, he said there is a possibility of a slight increase in the ringgit due to the ongoing discussions of stimulus in China and consistent intervention in the Chinese yuan, which should keep Asia forex stable this week.

Meanwhile, Bank Muamalat Malaysia Bhd chief economist and social finance head Dr Mohd Afzanizam Abdul Rashid said the ringgit is likely to remain weak against the US dollar as the Fed is likely to keep its hawkish stance on interest rates.

“The divergence in monetary policy might boost the US dollar in the near term, although the Federal Open Market Committee members are expected to shift their direction at some point in the future,” he said.

Mohd Afzanizam also believes that Malaysia’s second quarter of 2023 gross domestic product print which came in at 2.9 per cent suggests that the Bank Negara Malaysia is likely to maintain their accommodative monetary.

In the meantime, the ringgit was traded lower against a basket of major currencies.

It had weakened versus the Japanese yen to 3.1997/2027 from 3.1926/1959 last Friday, depreciated against the euro to 5.0530/0573 from 5.0503/0552 and inched down vis-a-vis the British pound to 5.9204/9255 from 5.9131/9189 previously.

At the same time, the local note traded mixed against other Asean currencies.

The ringgit ticked up vis-a-vis the Thai baht to 13.1299/1460 from 13.1331/1510 but declined against the Singapore dollar to 3.4232/4267 from 3.4228/4264 last Friday.

Meanwhile, the local note remained flat against the Philippines’ peso at 8.27/8.28 as well as the Indonesian rupiah at 303.9/304.1. – BK

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