At 9am, the ringgit opened lower against the greenback at 4.1460/1500 compared with 4.1445/1485 at Friday’s close.
President Joe Biden is expected to give more details on his infrastructure spending plans on Wednesday, while payrolls are forecast to rise by 630,000 on Friday amid chatter it could be a million or more.
American economists are projecting that the global economy would expand roughly at 6.4% this year, mainly attributed to the US fiscal stimulus giving positive spillovers to the rest of the world.
Commenting on this, Axi chief global market strategist Stephen Innes believes the local note would trade very much in line with broader US dollar sentiment today ahead of key data this week for both China and the US.
Asked if the ringgit would be able to climb higher against the US dollar this year, Innes believes the answer is “yes”.
“I think the ringgit can still improve on higher oil prices and other commodity channels, but I am more negative on the travel sector and other reopening trends as I think the government will be slow to reopen borders without strict quarantine restrictions until much later in the year.
“I was very optimistic in January but have now pulled back my bullish view to 4.05 versus 3.85 by year-end due to faster repricing of the Federal Reserve Board removing accommodation,” he said.
Separately, Kenanga Research also forecasts the ringgit to trade slightly higher this week on potential recovery of Brent crude oil prices following concern over the Suez Canal blockage, which could disrupt the oil supply from the Middle East to Europe and the US.
“Nonetheless, the upside would be capped by the increasing threat from a resurgence of Covid-19 cases,” it said in a note.
At the time of writing, crude oil fell 0.12% to US$64.49 per barrel.
Against other major currencies, the ringgit was traded mostly higher except against the Singapore dollar, falling to 3.0784/0821 from 3.0778/0814 at Friday’s close.
The ringgit improved vis-a-vis the yen to 3.7797/7837 from 3.7853/7900 on Friday, rose against the euro to 4.8832/8895 from 4.8872/8927, and edged up against the British pound to 5.7099/7158 from 5.7153/7224.