Ringgit opens higher on continued dollar weakness


KUALA LUMPUR: The ringgit opened slightly firmer against the US dollar today, benefiting from the continued greenback weakness and potential extension of the Organisation of the Petroleum Exporting Countries’ (OPEC) output cut.

At 9.01am, the local note was traded at 4.0630/0680 against the greenback from last Friday’s close of 4.0670/0710.

In a note today, Kenanga Research said the local unit’s uptrend might sustain against a backdrop of continued dollar weakness and higher crude oil price, should OPEC decides to extend the oil production cut at its meeting this week.

Over the past week, it said the ringgit surged further to its strongest level since Jan 24, 2020 as Parliament passed Budget 2021 with a voice vote at the policy stage, reducing policy uncertainty and political risks.

"The ringgit was also lifted by firmer oil price amid favourable COVID-19 vaccine developments,” it said.

On the technical front, Kenanga Research said according to the exponential moving average (EMA) technical indicator, the ringgit is expected to weaken slightly by 0.25 per cent to 4.079 as the US dollar attempts to reverse the pair trend.

"All in all, our technical analysis indicates a short-term bearish bias for the ringgit trend this week, probably due to potential profit-taking activities,” it said.

It said the bearish pattern could persist towards the 4.098 resistance level if the 4.083 resistance level is breached.

"Inversely, a rally towards the 4.061 level will invalidate the ringgit bearish pattern,” it said.

At the opening bell, the ringgit was traded mixed against other major currencies.

It was lower against the yen at 3.9112/9164 from 3.9083/9133 at Friday’s close and softer against the euro at 4.8634/8710 from 4.8479/8543 previously.

Vis-a-vis the pound, it rose to 5.4172/4243 from 5.4319/4389 and unchanged against the Singapore dollar at 3.0380/0420. - Bernama
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ringgit , US dollar , vaccine , OPEC ,  Kenanga Research

   

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