Upbeat sentiment lifts ringgit higher in early session

KUALA LUMPUR: The ringgit opened higher against the US dollar today as the procession of good news weighs on the safe-haven US dollar, with market players anticipating that the worst of Covid-19’s economic slowdown is behind Asia and the developed world.

At 9.11am today, the ringgit was quoted at 4.2900/2960 against the greenback from 4.3150/3200 at the close yesterday.

The gains in global oil price also provided a boost to market sentiment on the ringgit.

In a note, Oanda Asia Pacific senior market analyst, Jeffrey Halley said oil bounced sharply on Friday with both Brent crude and WTI posting near 90% gains in May as US President Donald Trump left the US-China trade deal intact on Friday.

“Yesterday, both contracts edged higher again following impressive manufacturing PMI’s from China and the rest of the Asian region.

“That has seen a renewed wave of buyer’s piling into the economic recovery trade across markets.

“Assuming no surprise headlines emerge to derail the rally, Brent crude looks set to advance on the US$40 a barrel region,” he said, adding that oil consumption seems set to increase in the near term with PMI data suggesting a manufacturing recovery and lockdowns ending across the world.

The potential dark cloud for oil prices, however, would be the next Opec+ meeting which is set to be brought forward to June 4.

Meanwhile, the ringgit was traded mostly higher against a basket of benchmark currencies, except against the British pound, where it declined to 5.3659/3747 from 5.3454/3533.

The local note rose against the Singapore dollar to 3.0497/0544 from 3.0620/0660, gained against the Japanese yen to 3.9866/9933 from 4.0099/0156 and was higher against the euro at 4.7743/7827 from 4.7953/8021.