The ringgit opened slightly higher against the US dollar on Monday as markets awaited key US economic data, while easing tensions in West Asia provided some support for the local currency, Bernama reported.
At 8am, the ringgit strengthened to 4.0805/0900 against the US dollar from 4.0835/0875 at last Friday’s close.
Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said investors were awaiting the US Institute for Supply Management (ISM) Manufacturing Purchasing Managers’ Index (PMI) for July, due later today.
The market expects the PMI to rise to 54.0 from June’s 53.3, he said, while uncertainties surrounding the West Asia conflict continued to influence sentiment.
“Additionally, uncertainties over the West Asia conflict also weighed on market sentiment, with Brent crude oil rising 4.59 per cent to US$88.10 per barrel.
“President Donald Trump reportedly said over the weekend that he has cancelled the planned military strikes against Iran as both countries are expected to reach a deal on the nuclear programme and the full reopening of the Strait of Hormuz,” he told Bernama.
Mohd Afzanizam expects the ringgit to trade in a narrow range of RM4.07 to RM4.09 against the US dollar today as markets remain cautious.
SPI Asset Management managing partner Stephen Innes said the US dollar weakened after Trump cancelled the planned strike on Iran, which he said had sent oil prices and inflation breakevens lower while pulling down the US interest-rate curve.
“That combination should be supportive for the ringgit and, more broadly, for risk assets across Asia today,” he added.
Against other major currencies, the ringgit weakened against the Japanese yen, euro and British pound.
It was mixed against regional currencies, strengthening against the Indonesian rupiah and Thai baht while slipping against the Singapore dollar and remaining little changed against the Philippine peso.
