Ringgit slips at open due to jitters over coronavirus

  • Forex
  • Wednesday, 22 Jan 2020

KUALA LUMPUR: The ringgit extended yesterday’s loss to open lower today due to market jitters about the outbreak of coronavirus in China and the first confirmed case in the United States.

At 9 am, the ringgit was quoted at 4.0790/0820 against the greenback compared with yesterday's close of 4.0710/0740. Rakuten in its daily market report said global markets were on a cautious mode on news of the continued spread of the highly contagious virus which has reached US shores.

"Memories of SARS epidemic back in 2002 and 2003 have caused knee jerk reaction to the markets, nevertheless the impact would be temporary," it said.

Besides the viral outbreak of the virus, the oil price has also declined to US$64.48 from its peak of US$71 per-barrel recorded earlier this month as demand for renewable energy rises.

On the local front, all eyes are on today's Monetary Policy Committee statement from Bank Negara Malaysia to gauge the current economic condition for further market direction.

Overall, the ringgit also traded lower against other major currencies. It was lower against the Singapore dollar at 3.0199/0226 from 3.0160/0193 on Tuesday and depreciated against the Japanese yen to 3.7109/7146 from 3.7016/7057.

The local currency fell against the euro to 4.5203/5241 from 4.5147/5189 while it slipped against the British pound to 5.3223/3278 from 5.3078/3133 yesterday. - Bernama

Ambank research also said that the key focus of the day is the Bank Negara monetary policy meeting, where the central bank is expected to keep the current interest rate on hold.

It added that markets were also pricing heavily for the European Central Bank to maintain rates at their upcoming monetary policy committee meeting.

"As such, we foresee the MYR to trade between our support level of 4.0522 and 4.0616. Meanwhile resistance is marked at 4.0829 and 4.0948," it said.

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