Ringgit opens higher against US$, other major currencies

KUALA LUMPUR: The ringgit was slightly higher against the US dollar at the start of trading today and also rose versus a basket of other major currencies as well as Asean currencies on positive sentiment following Bank Negara Malaysia’s (BNM) statement on the local note’s valuation.

At 9.05 am, the ringgit edged up to 4.7580/7620 against the greenback compared with Tuesday’s close of 4.7585/7635.

Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the central bank’s assurance regarding the ringgit’s valuation has helped improve its value and this might continue further today.

Yesterday, BNM governor Datuk Abdul Rasheed Ghaffour said in a statement that the ringgit is undervalued.

He also said the central bank has stepped up its engagements with government-linked investment companies, government-linked companies, corporations and investors to encourage continuous inflows to the foreign exchange market.

Previously, Prime Minister Datuk Seri Anwar Ibrahim said the central bank has been assigned to monitor the ringgit closely, and on the government’s side, relevant ministries and authorities, including the investment council, are conducting daily meetings to tackle the issue of the declining ringgit.

Mohd Afzanizam said foreign exchange (forex) market participants will also pay close attention to the release of personal consumption expenditures (PCE) inflation tomorrow.

The US Conference Board Consumer Confidence fell short of expectation when the index dropped to 106.7 points (January: 110.9 points) against consensus estimates of 115 points.

“There appears to be a less sanguine outlook by the US consumers with the percentage of those who say jobs are not plentiful rising to 13.5 per cent in February from 11.0 per cent in the previous month.

“On that note, the US Dollar Index has remained steady at around 103 points after reaching 105 points on Feb 13. This will provide support for the ringgit although the uncertainties remain heightened owing to a bullish view on the US dollar,” he said.

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

The local currency improved vis-a-vis the Japanese yen to 3.1623/1652 from 3.1671/1706 at Tuesday’s close, rose against the British pound to 6.0322/0373 from 6.0362/0425 yesterday, and strengthened versus the euro to 5.1586/1630 from 5.1625/1679 previously.

The ringgit also performed stronger against other Asean currencies.

It edged up versus the Thai baht to 13.2627/2787 from Tuesday’s close of 13.2782/2984 and was up against the Singapore dollar at 3.5404/5439 compared to 3.5419/5459 previously.

The local note also gained versus the Philippine peso to 8.47/8.48 from 8.48/8.49 yesterday and inched up vis-a-vis the Indonesian rupiah to 304.0/304.5 from 304.1/304.6 yesterday. – BK