Selangor Journal

Ringgit weakens against US dollar in early trade

KUALA LUMPUR, May 20 — The ringgit extended yesterday’s losses against the US dollar at opening today after the release of the Federal Open Market Committee (FOMC) meeting minutes, which indicated that the US economy was improving rapidly and could lead to a tighter monetary policy.

At 9am, the local currency was traded at 4.1410/1460 against the greenback from Wednesday’s close of 4.1360/1400.

ActivTrades trader Dyogenes Rodrigues Diniz said the market had been anticipating the monetary policy would have to change to restrain inflation and it was the main cause of the greenback gains against the ringgit.

“US macro factors are the driving force for this pair of currency at the moment, among a more muted macro outlook in Malaysia. From a technical point of view and also on the back of this macro-environment, we expect the local note to hit the 4.1500 level by Friday,” he said.

Dampening the sentiment for the local note, SPI Asset Management global managing partner Stephen Innes said oil prices were seen struggling due to India’s COVID-19 resurgence and other geopolitical tensions.

At the time of writing, Brent crude lost 0.08 per cent and traded at US$66.61 per barrel.

“When compounded by wobbly risk sentiment, the ringgit could struggle for traction today,” he told Bernama.

Meanwhile, the local note was traded lower against other major currencies.

The ringgit inched up against the Singapore dollar to 3.1037/1086 from 3.1039/1086 on Wednesday, marginally higher vis-a-vis the British pound at 5.8463/8542 from 5.8586/8651 and rose against the euro to 5.0442/0519 from 5.0496/0562.

However, the ringgit eased against the yen to 3.7925/7981 from 3.7882/7929.

— Bernama

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