Ringgit opens higher against US dollar

THE ringgit opened higher against the US dollar today as the greenback retreated following the release of the United States’ (US) economic data which came in below expectations, as well as the improvement in risk appetite, said an analyst.

At 9 am, the local note stood at 4.6350/6385 against the greenback from 4.6445/6475 at Tuesday’s close.

Bank Muamalat Malaysia Bhd chief economist and social finance head Mohd Afzanizam Abdul Rashid said the US job openings fell to 8.827 million in July against consensus estimates of 9.465 million.

He noted that the figure has also been on a declining trend after reaching a peak of 11.012 million in December 2022, suggesting demand for labour by the employer is waning.

“This would support the notion of softening in the labour market amidst weaker business sentiments as reflected by the Purchasing Managers’ Index (PMI),” he said.

Consequently,  he pointed out that the US Dollar Index (DXY) fell 0.56 per cent to 103.477 points while the 10-year US Treasury yield dropped eight basis points to 4.12 per cent with three-month yield also declining four basis points to 5.43 per cent.

“As such, the ringgit versus the US dollar could be experiencing some appreciation as the data points to supporting the view that the Federal Reserve might be less hawkish going forward. We expect the local note to reach between RM4.63 and RM4.64 today against the greenback,” he told Bernama.

On another note, ActivTrades trader Dyogenes Rodrigues Diniz shared that the downward movement of the US dollar was due to the consumer confidence data in the US, which came in lower than expected at 106.1 real against 116 as forecast.

“As this indicator measures the level of consumer confidence in economic activity, it is a good way to predict the impact that household consumption will have on the US Gross Domestic Product.

“With some specialists are already pointing to a possible scenario of higher inflation in the US, falling consumer confidence hints at a possible devaluation of the US dollar in the short to medium term,” he added.

Meanwhile, the ringgit also opened lower against a basket of major currencies.

The local note decreased versus the euro to 5.0382/0420 from 5.0221/0253 at Tuesday’s close,  eased against the British pound to 5.8591/8635 from 5.8590/8628, and declined against the Japanese yen to 3.1771/1797 from 3.1688/1711 yesterday. 

At the same time, the ringgit traded mixed against other Asean currencies.

It slipped against the Singapore dollar to 3.4326/4354 from 3.4297/4322 at Tuesday’s close, and depreciated vis-a-vis the Thai baht to 13.2353/2510 from 13.2171/2324 previously.

However, the local currency was higher against the Indonesian rupiah at 303.6/304.1 from 304.3/304.7 on Tuesday and was also better against the Philippine peso at 8.17/8.19 from 8.18/8.19.  — BERNAMA

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