The Malaysian ringgit opened slightly firmer but remains under pressure as geopolitical tensions boost demand for the US dollar as a safe-haven asset
KUALA LUMPUR: The ringgit opened slightly higher against the US dollar today but is expected to remain under pressure amid mounting geopolitical tensions, with traders continuing to favour the greenback as a safe-haven asset.
At 8 am, the local currency was traded at 3.9390/9535 against the greenback, compared with yesterday’s close of 3.9440/9495.
Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the US Dollar Index (DXY) continues to climb as the global community focuses on the effects of the closure of the Strait of Hormuz.
“China, which has been relying on imports from the Middle East, urged all sides to protect ships transiting the area while US President Donald Trump gave assurance that tanker escort would be provided to allow the flows of oil and gas,” he told Bernama.
“The ringgit closed lower against the greenback by 0.53 per cent to RM3.946 yesterday. In light of the risk aversion, we foresee the ringgit to continue to remain weak as traders seek refuge in the US dollar,” Mohd Afzanizam added.
At the opening, the ringgit traded mixed against a basket of major currencies.
The local note edged up vis-à-vis the Japanese yen to 2.4964/5059 from 2.5010/5048. It was marginally higher versus the euro at 4.5736/5904 from 4.5778/5842 at yesterday’s close. The ringgit declined against the British pound at 5.2590/2783 from 5.2451/2524.
The local note traded mostly lower against its ASEAN peers. It was almost flat against the Indonesian rupiah at 233.4/234.4 from 233.7/234.2 previously, fell versus the Philippine peso to 6.75/6.76 from 6.74/6.76 and was easier vis-à-vis the Thai baht to 12.4652/5222 from 12.4401/4637 at Tuesday’s close.
The ringgit improved versus the Singapore dollar to 3.0841/0959 from 3.0863/0909.
