The ringgit opened higher against the US dollar on Tuesday as investors remained cautious ahead of key central bank meetings this week, with the Federal Reserve and Bank of Japan in focus, Bernama reported.
At 8am, the local currency strengthened to 4.0705/0775 against the US dollar from Monday’s close of 4.0735/0770.
Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said market attention is centred on the upcoming Federal Open Market Committee (FOMC) and Bank of Japan (BOJ) policy meetings.
“Therefore, ahead of the FOMC and BoJ meetings this week, the ringgit is likely to stay cautious.
“Judging from the movement in the bond market, it appears that the US Federal Reserve (Fed) will deliver a 25 basis point hike,” he told Bernama.
He said yields from three-month and six-month US Treasury bills rose to 3.97% and 4.06% respectively, compared with 3.80% and 3.89% in the previous auction.
Meanwhile, Brent crude was hovering around US$105.68 a barrel, with the major Saudi Arabian East-West pipeline expected to take weeks to resume operations.
Afzanizam said potential oil supply shortages could put further upward pressure on global crude prices.
“As such, the ringgit is expected to trade within a narrow range today,” he said.
Against major currencies, the ringgit strengthened against the euro to 4.7006/7087 from 4.7008/7049 but weakened against the yen to 2.6362/6409 from 2.6355/6380. It also edged lower against the pound to 5.4952/5046 from 5.4931/4978.
Against ASEAN currencies, the ringgit rose against the Singapore dollar to 3.2041/2101 from 3.2055/2085, strengthened against the Indonesian rupiah to 230.3/230.8 from 230.5/230.8 and gained against the Philippine peso to 6.47/6.49 from 6.48/6.49.
The local currency slipped against the Thai baht to 12.2476/2742 from 12.2445/2598.
