KUALA LUMPUR: The ringgit opened marginally lower against the US dollar on Tuesday as traders remained cautious ahead of a possible interest rate cut by the United States Federal Reserve (Fed), an analyst said.
At 8 am, the local note eased to 4.2900/3020 against the greenback from Monday’s close of 4.2870/2945.
Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said New York Fed President John Williams and Atlanta Fed President Raphael Bostic have signalled that policymakers will continue to assess incoming data before making any decision.
"The US Dollar Index (DXY) fell 0.66 per cent to 100.426 points, as sentiment in the equities market improved, although several Fed officials remain reluctant to cut rates in the near term,” he told Bernama.
He said the two- and 10-year US Treasury yields slipped two and three basis points respectively to 3.98 per cent and 4.45 per cent, while the odds of a rate cut in June stand at below 10 per cent, based on Fed Fund Rate futures.
"Nonetheless, we expect the ringgit to stay supported as market sentiment improves amid tariff negotiations between the US and various countries globally,” he added.
Despite its slightly weaker performance against the greenback, the ringgit traded mostly higher against a basket of major and regional currencies at the opening.
It rose against the Japanese yen to 2.9582/9667 from Monday’s 2.9596/9650, appreciated versus the euro to 4.8181/8316 from 4.8344/8429, and strengthened against the British pound to 5.7302/7462 from 5.7420/7521.
Against regional peers, it inched up versus the Singapore dollar to 3.3120/3218 from 3.3135/3195 and firmed against the Thai baht to 12.9388/9864 from 12.9630/9924.
The local note, however, slipped against the Indonesian rupiah to 261.0/261.9 from 260.8/261.4, and eased against the Philippine peso to 7.70/7.73 from 7.69/7.71. - Bernama
