Ringgit opens on positive note against US$

KUALA LUMPUR: The ringgit opened on a positive note against the US dollar today on subdued demand for the American dollar due to weaker economic data from the United States (US).

At 9.01 am, the ringgit strengthened to 4.7000/7060 versus the greenback from Thursday’s close of 4.7020/7070.

Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the second estimate for the US first quarter (1Q) 2024 gross domestic product (GDP) came in lower at 1.3 per cent annualised rate quarter-on-quarter from the first estimate of 1.6 per cent.

The main engine of growth, Personal Consumption Expenditure (PCE), was also down to 2.0 per cent from the first estimate of 2.5 per cent.

The US dollar Index (DXY) fell below 105 points while the 2- and 10-year US Treasury note yielded lower by five and seven basis points to 4.92 per cent and 4.55 per cent, respectively, leading to a weaker bid for the greenback.

“The latest GDP prints seem to have reinvigorated the view that the US Federal Reserve (Fed) should cut rate this year to sustain the GDP within its long-term growth of 1.8 per cent,” Mohd Afzanizam told BK.

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

The local unit fell against the euro to 5.0906/0971 from 5.0838/0892 on Thursday’s close, slid versus the British pound to 5.9826/9903 from 5.9767/9831 and was lower versus the Japanese yen at 2.9974/3.0015 from yesterday’s close of 2.9959/9992.

The ringgit was mixed against its ASEAN peers.

It decreased against the Thai baht to 12.8125/8334 from 12.7727/7908 at Thursday’s close and dropped against the Singapore dollar to 3.4812/4859 from 3.4791/4833.

The ringgit rose vis-a-vis the Indonesian rupiah to 288.9/289.4 from 289.0/289.4 yesterday and traded flat versus the Philippine peso at 8.02/8.04 from 8.02/8.03 previously. – BK