KUALA LUMPUR: The ringgit opened flat against the US dollar amid a cloudy local political scene and weaker greenback, said an analyst.
As at 9am, the local note remained unchanged at 4.1660/1710 as Thursday’s close.
AxiCorp chief global market strategist Stephen Innes said the ringgit, however, could trade more favourably in the coming days ahead of anticipated better oil prices and news that Malaysian bonds will remain on the FTSE Russell’s World Government Bond Index (WGBI) watchlist.
“Being left on the watchlist was expected, but it does nothing for the ringgit on that accord.
“Overall, I also think that there is more room for the ringgit to play catch up to the basket of currencies if oil prices can do well,” he told Bernama.
Meanwhile, Maybank Kim Eng, in a research note, said FTSE Russell decided to keep Malaysia on its negative watch.
While FTSE Russell acknowledged Bank Negara Malaysia’s (BNM) initiatives to improve market accessibility for foreign investors, more time is needed to assess the efficacies of the measures to maintain Malaysia’s Market Accessibility Level at 2, a minimum requirement for the WGBI.
Innes also pointed out that the markets will continue to watch economic growth domestically and in China over the next few weeks, while they try to iron out election risk in the US.
The ringgit was also traded lower against other major currencies.
It eased against the Singapore dollar to 3.0278/0319 from Thursday’s close of 3.0252/0299 and declined against the British pound to 5.3125/3193 from 5.3075/3155.
The local currency dropped against the euro to 4.8596/8671 from 4.8488/8563 previously and fell versus the yen to 3.9473/9532 from 3.9522/9584.