KUALA LUMPUR, April 29 — The ringgit closed higher against the United States (US) dollar and regional currencies, due to easing crude oil concerns following the United Arab Emirates’ (UAE) exit from the Organisation of the Petroleum Exporting Countries (OPEC) pact.
At the same time, sentiments remained cautious ahead of the US Federal Reserve’s interest rate decision later today.
At 6pm, the local note appreciated to 3.9495/9540 against the greenback from 3.9505/9550 at yesterday’s close.
Bank Muamalat Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said news of the UAE’s departure from the OPEC pact, beginning in May, suggests the oil cartel may continue to lose its grip on sustaining higher crude oil prices, particularly once the current crisis subsides.
“As a result, West Texas Intermediate and Brent crude prices were little changed today.
“This is a positive development as the cartel system should be discouraged to allow market forces to function more effectively and efficiently,” he told Bernama.
Afzanizam added that improved efficiency in the price discovery mechanism will send the right signals to industry players, potentially encouraging a shift towards renewable energy.
Meanwhile, the US Federal Open Market Committee is expected to announce its interest rate decision at the conclusion of its meeting later today.
At the close, the ringgit traded mostly lower against a basket of major currencies.
It appreciated against the Japanese yen to 2.4709/4739 from 2.4756/4785 at the close on Tuesday, but slid against the euro to 4.6197/6250 from 4.6189/6242 yesterday, and slipped versus the British pound to 5.3330/3391 from 5.3292/3353 previously.
However, the local currency strengthened against regional peers.
It advanced against the Singapore dollar to 3.0909/0946 from 3.0943/0983 on Tuesday, jumped against the Thai baht to 12.0791/0980 from 12.1494/1685 yesterday, gained against the Indonesian rupiah to 227.9/228.3 from 229.1/229.4, and appreciated against the Philippine peso to 6.41/6.42 from 6.44/6.46 previously.
