KUALA LUMPUR: The ringgit extended its gains to open higher on Tuesday, with foreign exchange markets seen to have largely priced in Malaysia’s encouraging macroeconomic data and recent tariff developments.
At 8 am, the ringgit strengthened to 3.8790/9010 against the US dollar from Monday’s close of 3.8885/8925.
The local unit last traded at this level on April 13, 2018, when it stood at 3.8785/8815.
Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the ringgit has appreciated 0.31 per cent against the US dollar since Monday, as the greenback pierced the psychological RM3.90 level following a US Supreme Court decision last Friday.
"At this juncture, the support level for the ringgit against the US dollar is at RM3.8722. We sense that the foreign exchange market has priced in Malaysia’s positive macroeconomic data as well as recent tariff developments.
"As such, we expect the ringgit to trade sideways in the near term,” he told Bernama.
He said uncertainties surrounding US trade policy, along with geopolitical developments linked to US-Iran talks scheduled for Thursday, would continue to shape market sentiment.
"The US-Iran talks and the build-up of US military assets in the Middle East have led Brent crude to hover above US$70 per barrel in recent days.
"Traders will be monitoring geopolitical developments closely, as the 10- to 15-day deadline set by US President Donald Trump to conclude the nuclear talks could unsettle market sentiment,” he added.
At the open, the ringgit traded firmer against a basket of major currencies.
It rose against the Japanese yen to 2.5076/5220 from 2.5120/5147 at Monday’s close, strengthened versus the euro to 4.5745/6004 from 4.5888/5935, and advanced against the British pound to 5.2347/2644 from 5.2526/2580.
The ringgit also traded higher against its ASEAN peers.
It gained against the Singapore dollar to 3.0633/0809 from 3.0727/0761, strengthened versus the Thai baht to 12.5177/5969 from 12.5342/5532, rebounded against the Indonesian rupiah to 230.8/232.2 from 231.4/231.7, and edged up against the Philippine peso to 6.73/6.78 from 6.75/6.76. - Bernama
