KUALA LUMPUR, Aug 2 – The ringgit opens higher against the US dollar today, continuing its 10-day rally as investors anticipate possible Federal Reserve (Fed) rate cuts in September.
At 8 am, the ringgit marginally increased by 30 basis points to 4.5645/5725 against the greenback from Thursday’s close of 4.5675/5710.
Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the ringgit looks constructive versus the US dollar as the rate differential is likely to narrow between the federal funds rate and the overnight policy rate.
“After experiencing a sharp appreciation against the greenback, we still feel that the ringgit is undervalued and, therefore, the upside potential is still very much visible.
“However, the temptation among the traders to lock in gains would result in some correction in the ringgit in the immediate terms,” he said.
On that note, the ringgit would linger around 4.56 to 4.57, he added.
Meanwhile, the local note traded mostly lower against a basket of major currencies and mostly higher against ASEAN currencies.
