Ringgit Appreciates Against U.S. Dollar At Opening On Renewed Demand

The ringgit appreciated against the U.S. dollar at the opening today (May 10) on renewed buying interest and as the demand for the greenback weakened in thin trading.

At 9am, the ringgit rose to 4.7360/7400 versus the greenback from yesterday’s close of 4.7395/7425.

Bank Muamalat Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said the US Dollar Index (DXY) fell to 105.218 points as the Initial Jobless Claims (IJC) data spiked up to 231,000 last week from 209,000 a week ago.

He said higher IJC suggests more Americans are asking for insurance claims when out of work, which can be associated with a weaker labour market condition.

“Consequently, it gives credence to the rate cut expectation as the US Federal Reserve (Fed) might want to shift their attention from tamping down inflation to resuscitate growth,” he told Bernama.

Mohd Afzanizam said the 2- and 10-year US Treasuries yielded lower by four and three basis points to 4.80 per cent and 4.45 per cent, respectively, while the US equities rallied as lower interest rates could save the corporates from high borrowing costs.

“On that score, the ringgit should perform favourably. If we continue to witness weaker data going forward, it could bolster the value of emerging market currencies including the ringgit,” he added.

In the early trade, the ringgit traded lower against a basket of major currencies.

It fell versus the Japanese yen to 3.0451/0480 from Thursday’s close of 3.0401/0422, weakened vis-a-vis the British pound to 5.9299/9350 from 5.9177/9215 earlier and depreciated against the euro to 5.1054/1097 from 5.0855/0887 previously.

The local note traded mixed against Asean currencies.

Against the Singapore dollar, the ringgit dropped to 3.5006/5038 from Thursday’s 3.4939/4964 and decreased against the Thai baht to 12.8920/9078 from 12.8303/8436. It inched up vis-a-vis the Indonesian rupiah at 295.0/295.5 from 295.3/295.6 and was flat against the Philippine peso at 8.26/8.28.

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