KUALA LUMPUR – The ringgit opened marginally lower against the US dollar today due to the lack of buying momentum as demand for the greenback remained strong on the back of its safe-haven status, a dealer said.
At 9am, the local currency fell to 4.5670/5710 against the greenback from 4.5660/5695 at yesterday’s close.
ActivTrades trader Dyogenes Rodrigues Diniz said the recent United States interest rate hike was a signal that the US Federal Reserve (Fed) will continue with its restrictive monetary policy to contain the advance of inflation.
“Market expectations are that the Fed will keep tightening until the year-end, at which point interest rates could be between 4.0% and 4.5%.
“The dollar may continue to appreciate against the ringgit until it approaches the 4.6000 region,” he said.
Nevertheless, from a technical point of view, Diniz noted that the dollar is in an overbought situation against the ringgit, which calls for attention for investors betting on the pair.
At the opening, the ringgit was traded mixed against a basket of major currencies.
It declined against the Japanese yen to 3.2139/2172 from 3.1890/1919 at yesterday’s close and went down versus the Singapore dollar to 3.2207/2238 from 3.2196/2225.
However, the local note appreciated against the British pound to 5.1447/1492 from 5.1564/1603 yesterday and rose vis-a-vis the euro to 4.4958/4997 from 4.5002/5037.
Meanwhile, Bursa Malaysia opened marginally lower today, tracking Wall Street, which slipped for the third consecutive trading day as central banks’ rate hikes continued to weigh on sentiment.
Swiss National and Bank of England had increased their interest rates by 75 basis points (BPS) and 50 bps, respectively, following the Fed’s recent rate hike, dealers said.
At 9.03am, the benchmark FTSE Bursa Malaysia KLCI inched down 0.96 of-a-point to 1,438.20 from yesterday’s close of 1,439.16.
The benchmark index opened 0.05 of-a-point easier at 1,439.11. – Bernama, September 23, 2022
