Ringgit strengthens against US dollar as rising oil prices lift sentiment

KUALA LUMPUR: The ringgit finished stronger against the US dollar today, supported by rising oil prices which benefitted Malaysia as an oil exporter.

At 6 pm, the ringgit rose to 4.4670/4715 versus the greenback from 4.4845/4900 at Tuesday’s close.

The ringgit has outperformed other Southeast Asian currencies year to date by posting nearly a 2.8 per cent gain against the US dollar.

As of the time of writing, Brent crude had breached US$74 per barrel, while West Texas Intermediate stood above US$70 per barrel, supported by expectations of increased demand from China following news of new stimulus measures along with a decline in US crude inventories by 3.2 million barrels last week.

It was reported that Chinese authorities will issue a record US$411 billion in special treasury bonds next year as Beijing increases fiscal stimulus to revive its struggling economy.

UOB Kay Hian Wealth Advisors head of investment research Mohd Sedek Jantan said that expectations of a global economic rebound are likely to drive higher oil demand, thereby supporting the ringgit.

The ringgit continued to trade higher against other major currencies.

It appreciated versus the Japanese yen to 2.8373/8405 from Tuesday’s close of 2.8547/8586, firmed against the British pound to 5.5967/6023 from 5.6209/6278, and rose vis-a-vis the euro to 4.6448/6495 from 4.6603/6660.

The local note performed better against most ASEAN currencies.

It improved versus the Singapore dollar to 3.2875/2913 from 3.2979/3024 at the previous close, increased vis-a-vis the Indonesian rupiah to 275.8/276.3 from 276.9/277.4 and rose against the Thai baht to 13.0340/0543 from 13.1283/1517.

However, it was lower against the Philippine peso at 7.70/7.71 compared with 7.66/7.68 previously. – Bernama