Ringgit opens lower against US$ amid cautious sentiment

KUALA LUMPUR: The ringgit snapped two consecutive days of gains to open lower against the US dollar on cautious sentiment despite the weaker performance of the greenback.

The US Dollar Index (DXY) declined from as high as 106.01 points to 105.82 points despite the US Producer Price Index for September coming in higher than expected.

At 9 am, the local note fell to 4.7200/7245 against the greenback from Wednesday’s close of 4.7145/7180.

Bank Muamalat Malaysia Bhd chief economist and social finance head Dr Mohd Afzanizam Abdul Rashid said the 10-year US Treasury yield dropped by eight basis points to 4.58 per cent.

At the same time, the Federal Open Market Committee (FOMC) minutes showed that Federal Reserve members believe one more rate increase is warranted with focus towards holding the rate steady thereafter, he said.

“This implies that expectation of interest rate hike coming to an end is gaining traction.

“The next question then is how long the benchmark interest rates would stay high, which also implies that the next course of action is to bring the Federal Funds Rate down at some point in the future,” he told Bernama.

Meanwhile, the ringgit was traded mostly lower versus a basket of major currencies.

It went down against the euro to 5.0136/0184 from 4.9983/5.0020 at Wednesday’s close and declined vis-a-vis the British pound to 5.8113/8168 from 5.7918/7961 previously.

However, the ringgit appreciated versus the yen to 3.1644/1676 from 3.1711/1737 yesterday.

The local note was traded lower against other Asean currencies.

It eased versus the Singapore dollar to 3.4635/4673 from 3.4587/4617 at Wednesday’s close and slipped against the Philippine peso to 8.32/8.34 from 8.30/8.32 previously.

The ringgit also edged down against the Thai baht to 12.9842/13.0015 from 12.9462/9615 yesterday’s close and decreased versus the Indonesian rupiah to 300.6/301.0 from 300.2/300.6. – Bernama