THE ringgit continued its upward momentum to open higher against the US dollar today as US Treasury yields and dollar indices dropped to their lowest in months, said an analyst.
At 9am, the ringgit rose to 4.6415/6465 versus the greenback compared with yesterday’s close of 4.6690/6725.
SPI Asset Management managing partner Stephen Innes said the US dollar declined following dovish remarks from the US Federal Reserve (Fed) governor Christopher Waller yesterday.
Waller reportedly said he is “increasingly confident that policy is currently well positioned to slow the economy and get inflation back to 2.0%.”
Innes said the dovish lean from a Fed member is a huge confirmation bias for a market that was already positioning for rate cuts next year.
“The yield on the two-year US Treasury, which correlates with Fed Funds interest rate expectations, reached 4.75%, marking its lowest point since August.
“This should be very favourable for the ringgit. Hence, the market is opening up under the key 4.50 level,” he told Bernama.
In early trade, the ringgit was traded lower versus a basket of major currencies, except vis-a-vis the euro as it improved to 5.1121/1177 from 5.1140/1178 at yesterday’s close.
It fell against the Japanese yen to 3.1629/1665 from 3.1430/1456 yesterday and weakened against the British pound to 5.9054/9117 from 5.8965/9009 previously.
The local note was traded mostly higher against other Asean currencies.
It was marginally higher versus the Singapore dollar to 3.4920/4962 from 3.4948/4976, appreciated versus the Philippine peso to 8.39/8.40 from 8.42/8.43, and was firmer against the Indonesian rupiah to 300.6/301.1 from 302.4/302.8 at yesterday’s close.
The ringgit declined against the Thai baht to 13.3915/4137 from 13.3629/3791 previously. – Bernama, November 29, 2023