KUALA LUMPUR – The ringgit opened higher against the US dollar as traders digested the minutes of the United States Federal Open Market Committee (FOMC) meeting released last night, said an economist.
At 9am, the ringgit rose to 4.7900/7950 versus the US dollar compared with yesterday’s close of 4.7920/7965.
Bank Muamalat Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said the US dollar index eased by 0.08% to 103.99 after the release of the FOMC meeting outcome last night.
He noted that the US Federal Reserve was sanguine about its assessment of the economy as US gross domestic product growth remained robust, in addition to the deceleration in the inflation rate.
Consequently, the FOMC members agreed that interest rates should stay higher before they are confident that inflation will move towards the 2% goal.
As such, the two-year and 10-year US Treasury yields closed five basis points higher at 4.64% and 4.32%, respectively.
“At the current juncture, the ringgit is already in an oversold condition from a technical point of view, indicating the possibility of a slight appreciation.
“However, weak sentiments may see the US dollar stay elevated and the soft ringgit persist,” he said.
Meanwhile, the ringgit was traded mostly lower against a basket of major currencies.
The local currency was higher vis-a-vis the Japanese yen at 3.1848/1884 from 3.1925/1957 at yesterday’s close, but decreased against the British pound to 6.0570/0633 from 6.0432/0489 yesterday, and fell versus the euro to 5.1876/1930 from 5.1754/1802 previously.
At the same time, the ringgit was traded mixed against other Asean currencies.
It rose versus the Thai baht to 13.3389/3584 compared with 13.3631/3816 at yesterday’s close and improved vis-a-vis the Indonesian rupiah to 306.3/306.8 from 306.4/306.9.
However, the local note declined against the Singapore dollar to 3.5661/5701 from 3.5652/5688 yesterday and was flat against the Philippines’ peso at 8.56/8.58. – February 22, 2024