Ringgit appreciates versus US dollar, tracking positive yuan sentiment

KUALA LUMPUR: The ringgit appreciated against the US dollar at closing today, tracking the improved sentiment for the Chinese yuan following positive developments in Shanghai, amid concerns over recession in the United States (US).

At 6 pm, the local currency was traded at 4.3880/3915 versus the greenback from last Friday's close of 4.3980/3995.

SPI Asset Management managing partner Stephen Innes said, as Shanghai records 'zero-COVID' cases across its districts, the city is expected to gradually open up, hence, boosting the ringgit and other regional Chinese foreign exchange proxies.

"If China can orchestrate a healthy reopening, the worst could be behind the ringgit,” Innes told Bernama.

The ringgit is positively correlated to the Chinese yuan as China remains Malaysia's most important trading partner.

Meanwhile, OANDA Asia Pacific senior market analyst Jeffrey Halley said the concerns over recession talks in the US could likely lead to a decent correction in the US dollar.

This, he said, should provide a respite to the euro and Asian currencies and possibly gold and cryptocurrencies, at least until the US Federal Reserve (Fed) increases its core interest rate by another 0.50 per cent in June.

The ringgit was, however, traded mostly lower against a basket of major currencies.

It fell against the Singapore dollar to 3.1643/1671 from Friday's close of 3.1482/1497 and decreased vis-a-vis the euro to 4.5969/6005 from 4.5625/5640.

The ringgit slid versus the British pound to 5.4653/4696 from 5.3568/3586 last Friday and strengthened versus the Japanese yen to 3.3939/3969 from 3.4127/4142 previously.

The market was closed on Monday in lieu of Wesak Day public holiday which fell on Sunday. - Bernama