Ringgit opens easier ahead of Opec output cut decision

KUALA LUMPUR: The ringgit kicked off the last month of 2020 marginally easier against the US dollar, as the local currency market remains slightly jittery ahead of the delayed Organisation of the Petroleum Exporting Countries (OPEC) quota extension announcement.

At 9.01 am, the ringgit was traded at 4.0740/0790 versus the US dollar from Monday’s close of 4.0730/0750.

Reuters quoted sources as saying that OPEC+, which includes Russia and other oil producing countries, had postponed talks on crude oil output policy for 2021 to Dec 3, 2020, as key players still disagreed on how much oil they should pump amid weak demand due to the COVID-19 pandemic.

Axi chief global market strategist Stephen Innes said like most currencies directly buttressed by a significant crude oil export quotient, OPEC+ move presented a bigger speed bump than expected.

"The big news overnight is that Saudi Arabia is considering resigning from its role as co-chair of the OPEC+ Joint Ministerial Monitoring Committee (JMMC), according to press reports, putting pressure on crude oil prices,” he told Bernama when contacted.

According to Innes, Saudi co-chairs the JMMC with Russia, and it remained unclear as to what Saudi's goals are.

"But it is not easy to imagine an OPEC+ without Saudi playing a direct role at the top,” he said.

Apart from OPEC’s decision, Innes said the ringgit would also take the cue from the broader US dollar sentiment.

At the time of writing, benchmark Brent Crude oil price slid 1.22 per cent to US$47.59 per barrel.

Back home, the ringgit was traded mostly higher against other major currencies, except the pound.

It strengthened against the Singapore dollar to 3.0412/0461 from 3.0455/0486 at the close on Monday, went up against the yen to 3.9057/9116 from 3.9148/9171 yesterday and firmed versus the euro to 4.8652/8724 from 4.8807/8843 yesterday.

Vis-a-vis the pound, the ringgit, however, weakened to 5.4355/4426 from 5.4277/4308 on Monday’s close. - Bernama
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ringgit , OPEC ,  Axi , Stephen Innes , crude oil


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