KUALA LUMPUR, Dec 26 — The ringgit extended its rally today, opening higher to reach another five-year high against the US dollar amid a holiday-shortened trading week.

At 8am, the local currency surged to 4.0410/0495 against the greenback from 4.0425/0515 at Wednesday’s close. The ringgit hit 4.0450/0443 on February 26, 2021.

The market was closed yesterday in observance of Christmas Day.

Speaking to Bernama, Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said that in light of the holiday-shortened week, currency markets are likely to remain lacklustre today.

He noted that investors have remained constructive on the ringgit, with the US dollar-ringgit at its strongest level in five years.

“Typically, there could be some profit-taking activities, especially when the market has priced in all the positive news.

“Hence, we expect ringgit to continue trading in a narrow range of RM4.04-RM4.05 today,” he said.

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

It appreciated against the Japanese yen to 2.5874/5930 from 2.5940/5999 at Wednesday’s close, gained versus the British pound to 5.4578/4693 from 5.4647/4768, and strengthened vis-a-vis the euro to 4.7615/7715 from 4.7697/7804 previously.

The local currency also traded higher against its Asean peers.

It rose against the Singapore dollar to 3.1460/1531 from 3.1506/1578 on Wednesday, improved versus the Thai baht to 12.9990/13.0352 from 13.0486/0705 earlier, and was up vis-a-vis the Philippine peso to 6.86/6.89 from 6.88/6.90 previously.

However, the local note was slightly easier against the Indonesian rupiah at 241.3/242.0 compared to 241.0/241.8 previously. — Bernama