Ringgit opens stronger vs US dollar, major currencies

Focus

27 Jul 2023 09:58am

The ringgit opened on a strong note against the US dollar as well as several major Asian and non-Asian currencies today, while the greenback weakened after the US Fed raised its key interest rates to a 22-year high.

KUALA LUMPUR - The ringgit opened on a strong note against the US dollar as well as several major Asian and non-Asian currencies today, while the greenback weakened after the United States (US) Federal Reserve (Fed) raised its key interest rates to a 22-year high.

At 9 am, the local note rose to 4.5240/5290 against the greenback compared with 4.5470/5505 at Wednesday’s close.

According to a dealer, the Fed’s move to raise the Fed Fund Rate by 25 basis points (bps) to 5.50 per cent was expected as it continued to battle persistent inflation in the US economy.

According to reports, the US Dollar Index (DXY) eased by 0.32 per cent to 101.02 points, while the two-year US Treasury yield slipped by 2.0 bps to close at 4.85 per cent.

Bank Muamalat Malaysia Bhd chief economist and social finance head Dr Mohd Afzanizam Abdul Rashid said this showed that the US central bank would be data dependant in its determination to bring the US inflation rate down towards the 2.0 per cent target.

"We believe that this should provide support for the USD/MYR. Perhaps today the ringgit would linger around RM4.54 level versus the US dollar," he told Bernama.

Mohd Afzanizam said the ringgit vis-a-vis US dollar closed at RM4.5487 which is slightly below the support level of RM4.5491 yesterday.

In the meantime, the local unit was traded higher against a basket of major currencies.

It rose against the euro to 5.0162/0218 from 5.0353/0392 at Wednesday’s close, appreciated vis-a-vis the British pound to 5.8550/8614 from 5.8715/8761 yesterday and increased versus the Japanese yen to 3.2231/2269 from 3.2402/2429 previously.

At the same time, the local note was traded higher against other Asean currencies.

The ringgit was better versus the Singapore dollar to 3.4154/4194 from 3.4265/4297 at the close on Wednesday and rose against the Indonesian rupiah to 301.1/301.5 from 302.6/303.0.

The local note also strengthened vis-a-vis the Philippines’ peso to 8.29/8.31 from 8.32/8.33 previously and turned higher to 13.2513/2714 against the Thai baht from 13.2747/2904 at yesterday's close. - BERNAMA