KUALA LUMPUR, June 19 — The ringgit extended its gains to open higher against the US dollar in early trade today, as the greenback slipped amid growing anticipation of a global interest rate cut this year, an economist said.
At 9am, the ringgit rose to 4.7080/7130 versus the greenback from yesterday’s close of 4.7110/7155.
Bank Muamalat Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said the ringgit is likely to strengthen on the chance that a lower US interest rate will reduce rate differentials between the Federal Reserve (Fed) fund rate and overnight policy rate.
It was reported Fed governor Adriana Kugler in her speech yesterday noted it will be appropriate for the central bank to lower its interest rate later this year as economic conditions are moving in the right direction.
Afzanizam said the local currency trended upwards against regional currencies.
“Perhaps, the policy reform such as the diesel subsidy rationalisation may have contributed positively to the ringgit’s strength,” he told Bernama.
The ringgit traded lower against a basket of major currencies in early trade.
The local unit decreased versus the Japanese yen to 2.9818/9852 from yesterday’s close of 2.9798/9828, depreciated vis-a-vis the British pound to 5.9810/9874 from 5.9750/9807, and weakened against the euro to 5.0555/0608 from 5.0492/0541.
The local unit traded mixed against Asean peers.
It was better vis-a-vis the Indonesian rupiah at 286.8/287.2 from 287.0/287.3 and strengthened against the Philippine peso to 8.02/8.04 from 8.03/8.05.
It slipped against the Singapore dollar to 3.4838/4878 from 3.4793/4829 yesterday and fell versus the Thai baht to 12.8322/8507 from 12.7874/8048.
— Bernama
