KUALA LUMPUR: The ringgit opened higher against the US dollar today as the upside in the greenback seemed to be capped amidst improving risk appetites among market participants, an analyst said.
At 9 am, the local note stood at 4.3915/3995 against the US dollar from 4.3950/4000 at Wednesday’s close.
SPI Asset Management managing director Stephen Innes said the market’s expectations of China’s easing of COVID-19 restrictions continued to strengthen the Politburo China, which has significantly accelerated its preparation for a full reopening, thus helping to lift the ringgit stronger.
"China's exit from zero-COVID will be highly beneficial for Asia’s exporters of consumer goods and tourism services to China, hence the ringgit and Thai Baht stand out, and this will be the key theme that drives Asia foreign exchange performance in 2023," he told Bernama.
On another note, he said the United States’ (US) 10-year yield had dropped precipitously overnight, and given that the ringgit is sensitive to its performance, this was perceived as positive for local traders.
Meanwhile, ActivTrades trader Dyogenes Rodrigues Diniz said the investors are still uncertain about what to expect from the US Federal Reserve (Fed) over the coming months.
Investors are now awaiting the release of the US Initial Jobless Claims data and the Producer Price Index (PPI) which may provide further insight into the market direction, he said.
"From a technical point of view, the US dollar is still showing a Relative Strength Index (RSI) of below 30 against the ringgit, which suggests an oversold situation, whereby a bullish move could start over the next few days," he added.
Meanwhile, the ringgit was traded lower against a basket of major currencies this morning.
The local note depreciated against the British pound to 5.3559/3656 from 5.3320/3381 at Wednesday’s close and weakened vis-a-vis the euro to 4.6111/6195 from 4.6055/6108 yesterday.
It had also slipped versus the Singapore dollar to 3.2364/2428 from 3.2323/2365 on Wednesday and fell against the Japanese yen to 3.2142/2205 from 3.1936/1974 previously. - Bernama