Stronger demand lifts ringgit in early trade

KUALA LUMPUR: The ringgit opened higher against the US dollar in early trade today on better demand for the local note, amidst softer-than-expected US economic data and higher global oil price.

At 9.17am, the ringgit was traded at 4.1640/1700  against the greenback from 4.1680/1710 at yesterday’s close.

A dealer said market players are concerned of the US’s economic health as it may be affected by the trade war with China, as signalled by the declining factory activity.

“The US Institute for Supply Management said its index of national factory activity fell 0.2 points to 48.1 in November.

“Market players are also expecting the Federal Reserve to keep interest rates on hold for the next two years, further weakening the US dollar,” he added.

Meanwhile, global oil price rose after the Organization of the Petroleum Exporting Countries agreed to increase output curbs by an extra 500,000 barrels-per-day in early 2020, with the Brent futures up one cent at US$63.40 a barrel and the West Texas Intermediate oil futures increased two cents at US$58.45 a barrel.

The increase in oil price is seen to be positive for Malaysia as it would provide a boost to the country’s oil and gas revenue.

The ringgit was traded mostly lower against a basket of major currencies, except against the Singapore dollar, where it rose to 3.0600/0662 from 3.0611/0638.

It declined against the yen at 3.8283/8348 from 3.8253/8291, declined against the British pound to 5.4782/4865 from 5.4730/4786 and was lower against the euro to 4.6237/6308 from 4.6227/6269 at yesterday’s close.