KUALA LUMPUR, Sept 2 — Stronger oil and crude palm oil (CPO) prices as well as favourable Malaysian Government Securities (MGS) yield momentum continued to support the ringgit, which held on to its seven-month high against the US dollar today, albeit ending little changed compared to the previous day.

At the close, the local unit stood at 4.1430/1490 against the greenback from yesterday’s close of 4.1400/1450.

AxiCorp chief global market strategist Stephen Innes said the ringgit weakened to near 4.15 level at the opening on a firmer US dollar but bounced back supported by positive sentiments.

“Longer-term yield-seeking investors see the real returns from MGS very favourably as Bank Negara Malaysia (BNM) is expected to cut rates again. This is a crucial driver of the momentum,” he told Bernama.

It was widely expected that BNM may make a final 25-basis-points cut in the Overnight Policy Rate (OPR) during the Monetary Policy Committee (MPC) meeting on Sept 10, 2020.

“The CPO remains supported. In a similar light, crude palm oil prices have risen for five consecutive days on the back of China’s demand, compounded by production concerns as brokers fret ahead of production estimates by the Malaysian Palm Oil Association later this week,” Innes added.

The Brent crude and West Texas Intermediate hovered at US$45.68 and US$42.89 per barrel respectively amid a drawdown in the US stockpile.

The American Petroleum Institute (API) yesterday reported US crude oil inventories for the week ended Aug 28 decreased 6.4 million barrels versus a decline of 4.5 million barrels in the week ended Aug 21.

Yesterday, the CPO physical price stood at RM2,900 a tonne for September South.

Meanwhile, the ringgit was traded stronger against other major currencies.

It went up against the Singapore dollar to 3.0445/0494 from last Tuesday’s 3.0490/0539 and was higher against the yen at 3.9037/9101 from 3.9149/9207 yesterday.

The ringgit appreciated against the British pound to 5.5367/5451 from 5.5671/5742 and rose against the euro to 4.9173/9261 from 4.9593/9665 previously. — Bernama