KUALA LUMPUR: The ringgit opened higher against the US dollar on Wednesday, supported by a softer greenback and easing US Treasury yields, said an analyst.
At 8.04 am, the local currency edged up to 4.0380/0445 against the greenback from Monday’s close of 4.0405/0440. The market was closed on Tuesday in conjunction with Prophet Muhammad’s birthday.
Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said long-term US Treasury bond yields remain in the limelight, with the 30-year US Treasury securities yield declining by six basis points to 5.17 per cent.
He noted reports that the US Treasury Department may tap the Treasury General Account, which is cash parked at the Federal Reserve to finance the buyback programme.
"Consequently, the US Dollar Index (DXY) fell 0.10 per cent to 98.905 points.
"On that note, the ringgit could be well supported as the US authority is not in favour of a higher interest rate environment," he told Bernama.
He said uncertainty remains over the US Fed's next policy move. Therefore, US Fed chair Kevin Warsh's speech at the Jackson Hole Symposium this week will be closely scrutinised.
At the opening, the ringgit traded lower against a basket of major currencies, but marginally improved vis-a-vis the Japanese yen to 2.5360/5402 from 2.5380/5402 at Monday’s close.
It decreased against the British pound to 5.5099/5187 from 5.5080/5128 and fell versus the euro to 4.7140/7215 from 4.7132/7173 previously.
The local note traded higher against regional currencies.
It firmed versus the Indonesian rupiah to 227.8/228.2 from 227.9/228.3, edged up against the Philippine peso to 6.54/6.55 from 6.55/6.56 and rose against the Thai baht to 12.3486/3753 from 12.3589/3742 previously.
However, it fell vis-à-vis the Singapore dollar to 3.1810/186 from 3.1805/1835 on Monday. - Bernama
