KUALA LUMPUR: The ringgit opened slightly lower against the US dollar this morning on mixed market sentiment.
An analyst said the mixed sentiment is largely due to growing concerns over the global economy following the recent policy rate cut by the People’s Bank of China.
According to Bank Muamalat Malaysia Bhd chief economist Afzanizam Rashid, the high yields of the 10-year US Treasury bond implies that inflation remains elevated and hence necessitates a prolonged restrictive monetary policy by the US Federal Reserve (Fed).
He added that investors will be observing the Jackson Hole Symposium annual gathering between central bankers, in particular Fed chair Jerome Powell’s speech to gauge the direction of the US monetary policy.
The event will commence from Aug 24 to Aug 26.
“The ringgit versus the US dollar is expected to remain in the 4.64-4.65 range in the near term. From the technical analysis standpoint, the ringgit is already in an oversold position, suggesting that further downside risks are limited.
“Presently, the support and resistance level for the USD/MYR is located at 4.6257 and 4.7495. At the moment, it appears ringgit is hovering closer to its support level,” he told Bernama.
At 9am, the local note fell marginally to 4.6470/4.6530 against the greenback from 4.6465/4.6510 at Monday’s close.
In the meantime, the ringgit was traded lower against a basket of major currencies. However, it appreciated against the Japanese yen, rising to 3.1783/3.1826 from 3.1869/3.1902 at yesterday’s close.
It had weakened versus the euro to 5.0652/5.0718 from 5.0647/5.0696 and inched down against the British pound to 5.9305/5.9382 from 5.9196/5.9254 previously.
At the same time, the local note also traded lower against other Asean currencies, except against the Indonesian rupiah where it remains flat at 303.1/303.7.
The ringgit depreciated vis-a-vis the Thai baht to 13.2242/13.2485 from 13.2070/13.2258, slightly lower against the Singapore dollar to 3.4247/3.4296 from 3.4241/3.4279 and weakened against the Philippine peso to 8.25/8.28 from 8.24/8.26 on Monday.