KUALA LUMPUR, Sept 3 — The ringgit opened higher against the US dollar today as the favourable Malaysian Government Securities (MGS) yield momentum continues to support the local currency, dealers said.
At 9am, the local currency was quoted at 4.1410/1460 against the greenback from Wednesday’s close of 4.1430/1490.
Bank Islam Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the market seemed to be on a risk-on mode for the moment as the US dollar continued to slide, while risky assets such as equities were on the rise.
“This benefits the ringgit as investors became more constructive on the value of the local note,” he told Bernama.
He noted that with the higher global purchasing managers index (PMI) in August, the US Federal Reserve seemed to be committed to maintain its benchmark rate lower for a longer period.
Investors will now look towards the upcoming Bank Negara Malaysia’s Monetary Policy Committee (MPC) meeting on Sept 10 for guidance.
Meanwhile, AxiCorp chief global market strategist Stephen Innes said the stronger dollar and lower oil prices could likely blunt the edge of the ringgit rally, but demand for local government bonds will likely cap US dollar buying towards 4.1550.
The ringgit was also traded higher against other major currencies.
It went up against the Singapore dollar to 3.0364/0412 from Wednesday’s 3.0445/0494 and was higher against the yen at 3.8978/9032 from 3.9037/9101 yesterday.
The ringgit appreciated against the British pound to 5.5200/5270 from 5.5367/5451 yesterday and rose against the euro to 4.8992/9068 from 4.9173/9261 previously.
