KUALA LUMPUR, Sept 10 — The ringgit opened higher today, extending its better performance from last week, bolstered by the global investors’ higher appetite for riskier assets which includes Asean currencies, said a dealer.
At 9am, the ringgit improved to 4.1700/1750 against the US dollar from last Friday’s close of 4.1780/1830.
The market was closed yesterday in conjunction with the birthday of the Yang di-Pertuan Agong Al-Sultan Abdullah Ri’ayatuddin Al-Mustafa Billah Shah.
Axi Trader Asia-Pacific market strategist Stephen Innes said the easing of the US dollar index and the firmer Chinese’ yuan also allowed Asia capital markets to have a lesser interest cost for servicing foreign debt.
“Most significantly, the benefit of a stable to stronger Chinese yuan is that it has the calming effect of de-escalating trade war hostilities,” said Innes.
On the local front, Innes said investors will be closely monitoring Bank Negara Malaysia’s (BNM) fifth Monetary Policy Committee (MPC) meeting, scheduled on Thursday.
“Several banks are suggesting the MPC will deliver a rate cut despite the second-quarter gross domestic product (GDP) surprise, whereas others are thinking of a very dovish hold,” he said.
On May 7, BNM reduced the overnight policy rate (OPR) by 25 basis points (bps) to three per cent, its first interest rate cut since July 2016.
Innes said the rate cut was viewed positively for the ringgit as the Malaysian economy has been resilient and the move could improve equity sentiment and investments.
Meanwhile, the ringgit opened mostly higher against other major currencies.
It rose against the Singapore dollar to 3.0191/0238 from 3.0221/0261 recorded on Friday and increased versus the yen to 3.8805/8863 from 3.9050/9101.
The local unit however dropped against the British pound to 5.1462/1528 from 5.1385/1463 but marginally improved against the euro to 4.6045/6105 from 4.6079/6147 on Friday. — Bernama
