According to an analyst, risk sentiment has eased as the US interest rate hike cycle is thought to be over for the year, which is why the ringgit opened strongly against the US dollar.
The ringgit strengthened against the US dollar from last Friday’s close of 4.7265/7320 to 4.6750/6810 at 9:05 a.m.
The US interest rates are getting close to the cycle peak, according to Dr. Mohd Afzanizam Abdul Rashid, chief economist and head of social finance at Bank Muamalat Malaysia Bhd. This is partially due to a lower than expected Nonfarm Payrolls (NFP) report.
“The NFP, a measure of all US job creation, increased more slowly to 150,000 in October, indicating that the cycle of interest rate increases may be coming to an end.
“The decline in the quit rate from as high as 3.0 per cent in April 2022 to 2.3 per cent in September 2023 indicated employees’ confidence in the labour market had weakened as they might not be able to secure new jobs if they voluntarily resign,” according to Bernama.
In light of this, he predicted that the local currency would strengthen this week after being in an oversold position for a while. It is probably going to show a positive trend today, rising above RM4.70 in relation to the US dollar.With the exception of the British pound, where it declined to 5.7816/7890 from 5.7734/7801 at the close last Friday, the local currency was traded mostly higher against a basket of major currencies.
It strengthened versus the euro to 5.0135/0199 from 5.0318/0377 earlier, and it gained against the Japanese yen to 3.1260/1303 from 3.1445/1484.
In relation to other Asean currencies, the local note saw an increase in trade.
It broadened in relation to the Indonesian rupiah to 297.2/297.7 from 300.5/300.9 on Friday and strengthened against the Singapore dollar to 3.4553/4600 from 3.4713/4756 on Friday.
The ringgit also appreciated versus the Thai baht, going from 13.2332/2553 to 13.1861/2097, and versus the Philippine peso, it went from 8.42/8.44 to 8.37/8.39. – Manila
