KUALA LUMPUR, Feb 9 — The ringgit opened lower against the US dollar today as the greenback gained interest following the US Federal Reserve (Fed) rate hike narrative, an analyst said.
At 9am, the local currency stood at 4.1840/1870 versus the greenback from Tuesday’s close of 4.1835/1865.
Bank Islam Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said the ringgit should remain stable today as the Brent crude oil prices corrected slightly at around US$90 per barrel.
“Market participants could be waiting for Malaysia’s final quarter 2021 gross domestic product (GDP) which will be announced this Friday.
“Our estimates indicate that the GDP for the fourth quarter of 2021 (4Q2021) could come in at 3.1 per cent after experiencing a 4.5 per cent decline in the prior quarter,” he told Bernama.
Mohd Afzanizam said a possible appreciation of ringgit is quite likely as the government is anticipated to announce a further easing of international borders as early as in March.
“If that happens, we can expect Malaysia’s economy to be more lively as the tourism industry accounts for about 12.5 per cent of GDP in 2019, a year before the global economy was plagued by the Covid-19 pandemic.
“Should that happens, higher overnight policy rate is quite possible as that could help improve the value of the ringgit as the interest rate differentials with the advanced nation remain in our favour,” he added.
Mohd Afzanizam said for now, the ringgit is expected to trade at the RM4.18 level.
Meanwhile, the ringgit was traded mostly higher against a basket of other major currencies.
It appreciated slightly against the Singapore dollar to 3.1105/1130 from Tuesday’s close of 3.1106/1131, rose against Japanese yen to 3.6222/6251 from 3.6258/6284, and increased vis-a-vis the British pound to 5.6664/6705 from 5.6691/6731.
However, the local unit depreciated versus the euro to 4.7752/7786 from 4.7713/7747 previously.
— Bernama
