KUALA LUMPUR: The ringgit opened slightly easier against the US dollar this morning, reflecting a technical correction after its recent gains.
At 8 am, the ringgit stood at 4.1485/1595 versus the greenback, compared to yesterday’s close of 4.1480/1515.
Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the correction was understandable, given that the local currency has been in the overbought position based on the technical indicators.
"Having said that, ringgit should remain constructive in the mid- to long-term, underpinned by resilient economic growth and narrowing fiscal deficits, which can be deemed credit-positive by credit rating agencies.
"Today, we expect the USD/MYR to range between RM4.14 and RM4.15 as traders and investors await United States (US) data points,” he told Bernama.
Meanwhile, the US Dollar Index (DXY) strengthened by 0.24 per cent to 99.53 points as market expectations for a potential US interest rate cut in December continued to fade.
Mohd Afzanizam said the US Federal Reserve (Fed) remained cautious on the timing of any policy easing, prompting markets to look to the September US Nonfarm Payroll (NFP) data on Thursday for clearer economic signals.
"The Fed’s reluctance to cut rates has supported the US dollar, keeping the ringgit range-bound for now,” he added.
During the opening session, the ringgit traded higher against a basket of major currencies.
It appreciated versus the yen to 2.6720/6792 from 2.6805/6829 on Monday’s close, rose against the euro to 4.8077/8204 from 4.8125/8166 yesterday and improved vis-à-vis the British pound to 5.4561/4706 from 5.4608/4654 previously.
At the same time, the local currency traded mixed against ASEAN currencies.
It strengthened against the Thai baht to 12.7697/8111 from yesterday’s close of 12.7847/8018 and edged up versus the Singapore dollar to 3.1836/1922 from 3.1864/1893 previously.
The local note, however, was little changed against the Indonesian rupiah at 247.8/248.6 from 247.8/248.1 on Monday, and was almost flat against the Philippines’ peso at 7.04/7.06 from 7.04/7.05 previously. - Bernama
