KUALA LUMPUR: The ringgit extended its gains against the US dollar at Thursday's opening, supported by weaker-than-expected US economic data, an analyst said.
At 8 am, the local currency strengthened to 4.0655/0710 against the greenback from Wednesday's close of 4.0760/0805.
Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the US Dollar Index (DXY) fell 0.43 per cent to 100.485 after the US producer price index (PPI) unexpectedly declined by 0.3 per cent month-on-month in June, compared with market expectations of no change.
He said the decline was largely driven by lower energy prices in June following the implementation of the ceasefire between the United States and Iran.
"In addition, the US Federal Reserve (Fed) chairman Kevin Warsh's testimony before the Senate Banking Committee indicated that the Fed may not be in a hurry to raise interest rates in the near term.
"That should lend support to emerging market currencies, including the ringgit, as both the consumer price index (CPI) and PPI eased in June due to lower oil prices," he told Bernama.
Mohd Afzanizam expects the ringgit to trade between 4.06 and 4.08 against the US dollar today.
At the opening, the ringgit traded mostly lower against a basket of major currencies.
It rose against the Japanese yen to 2.5083/5119 from 2.5103/5132 at Wednesday's close, but weakened against the British pound to 5.5039/5113 from 5.4578/4638 and slipped versus the euro to 4.6631/6694 from 4.6536/6587 previously.
The local currency traded mostly higher against regional peers.
It edged up against the Indonesian rupiah to 225.0/225.4 from 225.5/225.9 previously, strengthened against the Philippine peso to 6.59/6.60 from 6.61/6.62, and appreciated versus the Thai baht to 12.1055/1280 from 12.1198/1371.
However, it eased against the Singapore dollar to 3.1552/1600 from 3.1546/1583 at Wednesday's close. - Bernama
