KUALA LUMPUR, Dec 28 — The ringgit strengthened further against the US dollar at the close today as the risk-on mode continued, aided by the positive moves in the Malaysian equity market and the stronger Asian currencies, dealers said.
At 6pm, the local note rose to 4.1785/1830 versus the greenback from 4.1815/1850 at yesterday’s close.
Bank Islam Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said the ringgit was clearly well supported as fears over the Covid-19 Omicron variant appears to be receding, with economic data pointing to improving momentum.
“The US dollar against ringgit pair (USD/MYR) was moving within the range of RM4.1812-RM4.1842, while the US dollar index (DXY) fell by 0.02 per cent to 96.07 points during the day,” he said.
Afzanizam also noted that the latest export print accelerated further to 32.4 per cent in November after the 25.5 per cent gain the preceding month, indicating that Malaysia’s fourth quarter (Q4 2021) gross domestic product could be better than Q3 2021.
“However, the flood situation may slow things down starting from December 18 as key states were badly affected by such calamities.
“But judging from the major equity indices, it looks like a risk-on mode has prevailed. That could lead to better performance for emerging market currencies, including the ringgit this week,” he told Bernama.
Meanwhile, Hong Leong Bank Research in a note said the easing concerns over Omicron gave rise to the risk-on sentiment.
“We are neutral-to-slightly bearish on USD/MYR today, as the renewed positive risk sentiment may weigh on the US dollar, while the year-end window dressing activity on the local front may continue to tilt the pair to the downside,” it added.
The ringgit was also traded mostly lower against a basket of other major currencies, except the Japanese yen.
It depreciated versus the Singapore dollar to 3.0860/0898 from yesterday’s close of 3.0789/0820, and slipped against the euro to 4.7355/7406 from 4.7284/7324 yesterday.
The local unit weakened vis-a-vis the British pound to 5.6188/6249 from 5.6040/6087 yesterday, but increased against the Japanese yen to 3.6401/6444 from 3.6462/6496 previously. — Bernama
