The ringgit opened lower against the US dollar on Friday, as the greenback stayed firm, amid resilient US economic data, said an economist.
At 9am, the ringgit had eased to 4.7745/7800 versus the US dollar, compared with Thursday’s close at 4.7710/7800.
Bank Muamalat Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said US economic data continued to defy market expectations, which could lead to continuous support for the greenback.
He noted that initial jobless claims were lower than expected at 201,000 last week, against consensus estimates of 217,000, while manufacturers’ sentiment improved to 51.5 points in February, the second consecutive month above the 50-point level indicating an expansion.
“On that note, the ringgit is likely to remain lukewarm against the greenback, ranging around 4.77 to 4.78. Malaysia’s consumer price index print will be out today (Friday), with the consensus forecasting it to remain fairly stable at 1.6% in January, slightly higher from 1.5% in the prior month.
“At 1.6%, the real interest rate is 1.4%, which is still above the 0.6% long-term average. As such, the monetary policy stance can be deemed restrictive. Hence, the scope for a higher overnight policy rate is limited,” he told Bernama.
SPI Asset Management managing director Stephen Innes said that on a positive note, the ringgit opened below this week’s weakest level. On a negative note, the broader US dollar was stronger overnight after better-than-expected US data.
“In addition, it looks like Asia will carry the risk-on baton today (Friday), which has engulfed global markets, and which is typically viewed positively on Asian foreign exchange. All told, US yields remained firm, which should ultimately limit gains for the day,” he added.
Meanwhile, the ringgit was traded higher against a basket of major currencies.
The local currency was higher vis-a-vis the Japanese yen at 3.1735/1776 from 3.1764/1826 at Thursday’s close, increased against the British pound to 6.0431/0500 from 6.0468/0582, and rose versus the euro to 5.1670/1729 from 5.1775/1873 previously.
At the same time, the ringgit was traded mixed against other Asean currencies.
It advanced versus the Thai baht to 13.2780/2999 compared with 13.3105/3404 at Thursday’s close, and improved against the Singapore dollar to 3.5554/5600 from 3.5578/5648.
However, the local note slipped vis-a-vis the Indonesian rupiah to 306.2/306.7 from 305.9/306.7 on Thursday, and was easier against the Philippine peso at 8.57/8.58 from 8.56/8.58. – Bernama
