Ringgit extends losses to open lower against US dollar
KUALA LUMPUR,. The ringgit extended its losses against the US dollar to open lower today as the greenback strengthened on positive United States (US) economic data.
At 9.03am, the local note stood lower at 4.2400/2430 versus the greenback compared with 4.2270/2300 at Monday’s close.
Bank Islam Malaysia Bhd economist Adam Mohamed Rahim said the ringgit is expected to face some headwinds today amid a stronger US dollar due to the recent strong US jobs data.
“The US Federal Reserve (US Fed) officials have made the jobs market recovery as a condition for tighter monetary policy.
“Such upbeat jobs news is helping to support the view that the US Fed may act more quickly to tighten the US monetary policy,” he told Bernama.
At the same time, Adam said that concerns over China’s economic growth and the fast-spreading Covid-19 Delta variant had also added to the pressure on the local currency.
ActivTrades trader Dyogenes Rodrigues Diniz said the market has remained uncertain in the recent days following the US Fed’s announcement that it may need to tighten its monetary policy starting from the next meeting.
“If the US Fed does adopt a more hawkish stance, it will mean that less money will be available to fund companies’ growth, stocks may fall and the dollar is likely to appreciate even more against its counterparts.
“This week, investors will also closely watch the Consumer Price Index for the dollar, which may give a glimpse into the US inflation,” he added.
Meanwhile, the local note was traded higher against a basket of major currencies.
The ringgit rose against the Japanese yen to 3.8309/8339 from 3.8382/8413 at Monday’s close and appreciated vis-a-vis the euro to 4.9659/9694 from 4.9718/9753.
It strengthened against the Singapore dollar to 3.1163/1187 from 3.1179/1206 and was higher against the British pound at 5.8601/8643 from 5.8717/8759 previously. — Bernama