Ringgit opens marginally higher on renewed buying interest

KUALA LUMPUR: The ringgit opened slightly higher against the US dollar today on renewed buying interest of the local currency, said a dealer.

At 9 am, the local currency stood at 4.2175/2220 from 4.2185/2215 at Monday’s close.

A dealer said this was in line with improved sentiment on the local equity market with the FTSE Bursa Malaysia KLCI barometer index opening 2.74 points better at 1,601.66.

However, the US dollar continued to regain its safe-haven currency appeal amid uncertainties surrounding the market which saw the US Dollar Index (DXY) rising quite substantially by 0.39 per cent to 98.989 points, Bank Islam Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid told Bernama.

"The equities made a strong rebound with technology bellwether Nasdaq gaining 1.9 per cent to close at 14,532.55 points and Brent crude hovering at US$108 per barrel despite the plan to release oil from the Strategic Petroleum Reserve by the US to stabilise oil prices.

"Meanwhile, the US Treasury yield curve was inverted when the two-year notes yielded higher than the 10-year yield, a phenomenon that is closely associated with a possible recession on the horizon," he said, adding that the financial market was very fuzzy with each asset class giving a mixed signal.

Mohd Afzanizam said in light of the unsettling effects of the military conflict in Ukraine, along with mixed signals from the financial market, the demand for safe-haven currencies, especially the US dollar, will likely continue to dominate the forex market sentiments.

As such, he opined that the ringgit should stay weak at the prevailing level of around RM4.22 today.

At the opening, the ringgit was traded mostly mixed against a basket of major currencies.

The local unit appreciated against the British pound to 5.5296/5355 from 5.5330/5369 at Monday's close and rose against the euro to 4.6291/6341 from 4.6441/6474.

It fell vis-a-vis the Singapore dollar to 3.1091/1127 from 3.1082/1109 on Monday and slid against the Japanese yen to 3.4420/4462 from 3.4414/4442. - Bernama