KUALA LUMPUR, July 8 — The ringgit closed higher today, strengthening against major currencies but easing against the United States dollar as persistent geopolitical tensions in West Asia boosted demand for the safe-haven greenback, said an analyst.
At 6pm, the local currency eased to 4.0750/0800 against the US dollar from yesterday’s close of 4.0685/0735.
Bank Muamalat Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid told Bernama that crude oil prices rose substantially following US military attacks on Iranian forces today.
He noted that the US government’s decision to revoke a waiver on Iranian oil sales underscores the fragility of the ceasefire agreement and raises concerns that renewed tensions could heighten the risk of closing the Strait of Hormuz.
At the time of writing, benchmark Brent crude for the September contract traded 5.68 per cent higher at US$78.28 per barrel.
“Markets are also likely to scrutinise the Federal Open Market Committee (FOMC) minutes, which will be published on July 9,” he said.
On the local front, Afzanizam said Bank Negara Malaysia’s Monetary Policy Committee (MPC) will meet to decide the Overnight Policy Rate (OPR). Most economists anticipate that the benchmark rate will remain unchanged at 2.75 per cent.
The MPC will have its fourth meeting for the year tomorrow.
At the close, the ringgit was traded higher against a basket of major currencies.
It strengthened against the Japanese yen to 2.5083/5114 from 2.5124/5156 at yesterday’s close, appreciated against the British pound to 5.4369/4435 from 5.4432/4499, and rose versus the euro to 4.6471/6528 from 4.6483/6540 yesterday.
Meanwhile, the local currency traded mostly flat against regional peers.
It was almost flat against the Singapore dollar at 3.1487/1528 from 3.1488/1529, and edged up against the Thai baht to 12.1685/1882 from 12.2129/2331 yesterday.
The ringgit was flat against the Indonesian rupiah to 226.2/226.5 from 226.2/226.6, and also flat against the Philippine peso at 6.62/6.64 from 6.62/6.63 at yesterday’s close.
