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Malaysia: Ringgit opens higher despite weaker oil prices
KUALA LUMPUR, Feb 8 ― The ringgit opened higher against the US dollar today on buying interest despite falling crude oil prices, said an analyst.
At 9.00am, the local currency was traded at 4.1820/1860 versus the greenback from Monday’s close of 4.1835/1850.
At press time, Brent crude oil stood at US$92.65 per barrel, a decrease of 0.04 per cent.
Bank Islam Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said although crude oil has been hovering above US$90 per barrel, it supports the ringgit at the moment.
“Higher crude oil prices would help improve fiscal space for the Malaysian economy that could then underpin growth.
“In that sense, the case for a stronger ringgit is quite visible,” he told Bernama.
Mohd Afzanizam said the Consumer Price Index (CPI), which is the the key data that will be released this week, is expected to be sustained at more than 7.0 per cent for January.
“So the rate hike in the US is almost a done a deal and the next question is the quantum for the hike.
“On one hand, there’s forces that would lead the appreciation of ringgit while on the other hand, there is a factor that will lift the US dollar,” he said.
He said therefore, the ringgit should stay around RM4.18 against the greenback in the immediate term.
Investors would also weigh Malaysia’s final quarter gross domestic product (GDP) on Friday, he said, adding that, “The number could come in positive after recording negative print in the prior quarter following the reopening of the economy in October.”
Meanwhile, the ringgit was traded mostly lower against a basket of other major currencies.
It slipped against the Singapore dollar to 3.1125/1157 from Monday’s close of 3.1102/1115, fell against the British pound to 5.6603/6658 from 5.6536/6556, and depreciated versus the euro to 4.7850/7896 compared with 4.7780/7797 previously.
The ringgit, however, appreciated against the Japanese yen to 3.6274/6312 from 3.6369/6385. ― Bernama