Ringgit retreats in early trade

KUALA LUMPUR: The ringgit retreated against the US dollar to open lower today as worries over the Covid-19 outbreak pulled investors’ appetite away from the local note.

At 9.13am, the local note was lower at 4.1730/1770 against the greenback from 4.1575/1625 at yesterday’s close.

AxiCorp chief market strategist Stephen Innes said global risk aversion and lower oil prices on the back of Russia failing to commit to Opec compliance would take the shine off the ringgit today as Covid-19 continues to sweep the world.

“Investors are starting to price in worst-case scenarios, anticipating the spread of this virus through Europe and the US, and are now accelerating their hedging game plans for the eventuality of the Eurozone falling into recession and the US economy stagnating in the first half of the year.

“With no material developments around the virus itself overnight, assessments of the economic costs look to have weighed on sentiment as reality sets in that a significant chunk of the global economy is set to go up in flames,” he added.

Against other major currencies, the ringgit was traded lower.

It weakened against the Singapore dollar to 3.0154/0201 from yesterday’s close of 3.0018/0056 and decreased versus the Japanese yen to 3.9312/9371 from 3.8870/8927.

The local unit was also lower vis-a-vis the British pound at 5.4049/4118 from 5.3707/3788 yesterday and depreciated against the euro to 4.6813/6881 from 4.6452/6512.