THE ringgit opened lower against the US dollar today as technical correction prevailed following a sizeable rally over the last three trading days, an analyst said.

At 9.05am, the ringgit depreciated to 4.6550/6600 versus the greenback from yesterday’s closing of 4.6340/6400.

SPI Asset Management managing director Stephen Innes said the US yields have lifted and introduced a minor corrective element to the unbroken confidence that ringgit investors had shown following last week’s Federal Open Market Committee (FOMC) meeting.

“So US dollar/ringgit will correct higher (weaker ringgit) today after experiencing a sizeable rally over the last three trading sessions,” he said.

“This is not uncommon after big moves as the market pauses to reflect and decide the next short-term direction, especially ahead of a deluge of Federal Reserve (Fed) speakers this week and the all-important US bond auctions slated for later in the week.”

Bank Muamalat Malaysia Bhd chief economist and head of social finance Mohd Afzanizam Abdul Rashid said the two-year and 10-year US Treasuries saw a rebound last night, rising by 10 and eight basis points to close at 4.94% and 4.65% respectively, while the US Dollar Index was up by 0.25% to 105.281 points.

He said it had been risk-on mode for markets since the Fed slightly changed its tone in the recent FOMC meeting and the lower-than-expected non-farm payrolls print last week.

“Perhaps there could be some correction today following a sharp appreciation yesterday. The current support and resistance levels for the US dollar/ringgit are located at 4.5578 and 4.6611.

“As such, the ringgit might linger around 4.63 to 4.65 today,” he said.

The local currency was marginally higher vis-a-vis the British pound to 5.7424/7486 from 5.7462/7536 at yesterday’s close but was traded lower against other major currencies such as the Japanese yen and euro.

It fell against the Japanese yen to 3.1021/1056 from 3.0959/1002 at yesterday’s close and weakened versus the euro to 4.9850/9904 from 4.9806/9871.

The local note was also traded lower against other Asean currencies.

It declined against the Singapore dollar to 3.4430/4470 from 3.4341/4388 at yesterday’s close and decreased vis-a-vis the Indonesian rupiah to 299.5/300.0 from 298.1/298.7.

Similarly, the ringgit eased against the Thai baht to 13.0887/1090 from 13.0521/0741 yesrterday and shrank versus the Philippine peso to 8.30/8.32 from 8.29/8.30. – Bernama, November 7, 2023.