Ringgit opens higher on improved risk appetite

KUALA LUMPUR: The ringgit opened higher against the US dollar on Monday, as the greenback retreated on the back of improved riskier asset demand with the progress in the vaccine rollout to curb COVID-19 infections, dealers said.

At 9.00 am, the local currency stood at 4.0360/0420 against the US dollar from last Friday’s close of 4.0380/0430.

Axi chief global market strategist Stephen Innes said the ringgit, however, is expected to continue trading in a tight range, supported by steady crude oil prices which traded over US$60 per barrel but getting held in check by rising US yields.

"How disruptive US yields become via the currency market, and particularly Asia foreign exchange (FX), really comes down to the rise in speed and how quickly traders reprice the short end of the US curve.

"Any signs of a faster Federal Reserve Fund's rate hikes will be the ultimate wrecking ball for Asia FX sentiment,” he told Bernama.

Meanwhile, Hong Leong Bank, in a research note, calls for "neutral” on the US dollar against ringgit pair (USD/MYR) for the week ahead, anticipating a range of 4.03-4.06.

"US dollar could firm up further if the US Treasuries selloff resumes. Having said that, markets are now reassessing the potential difficulties for US president Joe Biden’s US$1.9 trillion stimulus bills to pass Congress,” it added.

The local currency was traded mixed against other major currencies on Monday.

It fell against the Singapore dollar to 3.0502/0559 from 3.0489/0534 last Friday and depreciated against the British pound to 5.6649/6738 from 5.6488/6566.

The ringgit went up vis-a-vis the euro to 4.8932/9021 from 4.8993/9062 and rose against the yen to 3.8263/8324 from 3.8315/8366 previously. - Bernama

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