Ringgit slightly lower on cautious sentiment

KUALA LUMPUR: The ringgit reversed its gains to open slightly lower against the US dollar today, as traders were seen adopting a wait-and-see approach due to the enforcement of the Movement Control Order (MCO) 3.0, a dealer said.

At 9am, the local currency eased to 4.1170/1220 against the greenback from Wednesday’s close of 4.1150/1200.

SPI Asset Management global managing partner Stephen Innes said the decline in oil price due to profit-taking after the increase in US oil product stocks also influenced the local note performance.

"In addition, there remain concerns that India could shift into a full lockdown, and the Organisation of the Petroleum Exporting Countries may be less inclined to overheat the market, given the political fallout from manipulating prices higher by holding back production," he told Bernama.

At the time of writing, crude oil was trading at US$68.41 per barrel, down by 0.80 per cent.

Meanwhile, the government on Wednesday issued an order to enforce the MCO in Kuala Lumpur and several districts in Terengganu, Johor and Perak from May 7 to 20.

Commenting on this, Innes said traders may also precariously perch on the fence, hoping for the MCO to flatten the epidemic curve before reentering bullish bets on the local unit.

On other development, investors would be focusing on Bank Negara Malaysia’s decision on the overnight policy rate at its third monetary policy meeting later today, as well as the central bank’s latest assessment on the domestic economy.

At the opening, the ringgit was traded lower against other emerging currencies.

Against the Singapore dollar the ringgit fell to 3.0816/0856 from 3.0799/0848 and declined against the yen to 3.7646/7702 from 3.7628/7677 at Wednesday’s close.

Vis-à-vis the the British pound, the ringgit slipped to 5.7226/7300 from 5.7174/7256 and eased against the euro to 4.9396/9468 from 4.9392/9461. - Bernama

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