Ringgit opens slightly higher against greenback

KUALA LUMPUR: The ringgit opened slightly higher against the US dollar today, as the greenback retreated on concerns about the latest coronavirus variant and travel controls being imposed by various countries.

At 9 am, the local note rose to 4.2350/2395 against the greenback from 4.2370/2400 at Friday’s close.

Bank Islam Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said while there appeared to be anxiety over the new variant of concern (VOC), the selling of the ringgit could be seen as somewhat overdone.

"This happened as talks about a possible interest rate hike in the United States (US) alongside with inflation worries had taken a serious toll on emerging market currencies.

"Therefore, there could be buying opportunities for the ringgit since the Federal Reserve could be inclined to take a pause or might tweak its narratives in view of the VOC named Omicron,” he told Bernama.

He added that with the immediate resistance level at RM4.245, it would require more negative news in order to pierce such a level; however, the ringgit was expected to remain soft around RM4.23 per US dollar.

Hong Leong Bank Bhd, in a research note, said the US dollar climbed higher for a ninth straight session against the ringgit on Friday last week, hitting an intraday high of 4.2485 before narrowing some gains to 4.2385 towards close.

"We are neutral-to-bullish on the greenback versus ringgit pair in the week ahead as markets continue to grapple with uncertainties surrounding the latest Omicron virus strain.

"That said, the greenback’s overbought position suggests some imminent pullback before further moving higher. We therefore expect the pair to trade in a range of 4.20 to 4.25,” it added.

Meanwhile, the local note was traded lower against a basket of major currencies at the opening.

It eased versus the British pound to 5.6444/6504 from 5.6403/6443 at Friday's close and depreciated compared to the Singapore dollar to 3.0910/0948 from 3.0893/0920.

The ringgit fell against the Japanese yen to 3.7231/7274 from 3.7131/7160 on Friday and slipped vis-a-vis the euro to 4.7809/7860 from 4.7713/7747. - Bernama
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