THE ringgit opened higher against the US dollar today after the United States Federal Open Market Committee (FOMC) made a unanimous decision to keep the Fed Fund Rate steady at a range of 5.25-5.5% during its meeting last night.

At 9.05am, the ringgit appreciated to 4.7520/7570 against the greenback from yesterday’s close of 4.7695/7735.

Bank Muamalat Malaysia Bhd’s chief economist and head of social finance Dr Mohd Afzanizam Abdul Rashid said the decision by the Federal Reserve aligned with market expectations.

“However, the Fed’s evaluation of the economy is showing a more cautious stance. In the accompanying FOMC statement, it was explicitly stated that the tightening of financial and credit conditions is expected to impact economic activities.

“The term ‘financial’ likely refers to the significant increase in long-term US treasury yields, which has reduced the need for the Fed to implement additional monetary tightening measures,” he told Bernama.

He also said the current development could have a positive effect on the ringgit as it has been in an oversold condition for an extended period.

Meanwhile, the local currency traded lower against a basket of major currencies.

The ringgit depreciated against the Japanese yen to 3.1600/1635 from 3.1540/1569 at yesterday’s close, lower against the euro to 5.0371/0424 from 5.0313/0356 and fell against the British pound to 5.7936/7997 from 5.7897/7946.

The local note traded mixed against other Asean currencies.

It appreciated against the Indonesian rupiah at 298.1/298.6 from 299.2/299.6 and rose against the Philippine peso at 8.37/8.39 from 8.39/8.41.

The ringgit depreciated against the Singapore dollar to 3.4800/4840 from 3.4786/4820 and was lower against the Thai baht to 13.1982/2176 from 13.1645/1803. – Bernama, November 2, 2023.