KUALA LUMPUR, Jan 18 — The ringgit close marginally lower against the US dollar today on the back of rising US Treasury yields, dealers said.
At 6pm, the local note finished at 3.9540/9570 against the greenback from 3.9520/9560 on Wednesday.
Oanda Corp Head of Trading for Asia Pacific, Stephen Innes, said the ringgit was initially traded higher, however, the US Treasury yields rose and triggered a stronger US dollar momentum and some short covering in early trade.
“The ringgit is more than up for the challenge,” Innes said, adding that today's lethargic foreign exchange market moves suggested that investors would continue to take advantage of any opportunistic retreat on the dollar-ringgit exchange rate as bullish momentum remained intact.
“While higher US bond yields could present some headwinds for the local unit, surging global equity markets and higher energy prices more than offset the pressure from US interest rates, and the local traders started to re-engage short dollar-ringgit positions once the dollar correction ran out of steam,” said Innes.
Oil prices also lent support as there was tightening supply and strong global demand, he added.
The domestic note traded mixed against a basket of major currencies.
It declined against the Singapore dollar to 2.9887/9912 from Wednesday’s 2.9867/9906, but advanced against the Japanese yen to 3.5522/5553 from 3.5674/5720 yesterday.
The ringgit eased against the British pound to 5.4731/4777 from 5.4506/4577 and was higher against the euro at 4.8290/8339 from 4.8388/8441. — Bernama