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

At 9am, the local note stood at 4.6350/6385 against the greenback from 4.6445/6475 at yesterday’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 last month against consensus estimates of 9.47 million.

He said the figure has also been on a declining trend after reaching a peak of 11.01 million in December last year, suggesting demand for labour by the employer is waning.

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

Consequently, he said the US Dollar Index fell 0.56% to 103.477 points while the 10-year US Treasury yield dropped eight basis points to 4.12% with three-month yield also declining four basis points to 5.43%.

“As such, the ringgit versus the US dollar could be experiencing some appreciation as the data point 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 said the downward movement of the dollar was due to 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 GDP.

“With some specialists 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 yesterday’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 yesterday’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 yesterday and was also better against the Philippine peso at 8.17/8.19 from 8.18/8.19. – Bernama, August 30, 2023.