Ringgit slightly higher against US dollar in early trade

 

KUALA LUMPUR: 

The ringgit opened slightly higher against the US dollar in early trade on Monday despite the cautious sentiment following US president-elect Donald Trump’s threat to impose 100% tariffs against BRICS nations if they were to create a rival currency to the greenback.

At 8.03am, the ringgit traded at 4.4400/4.4500 against the US dollar, strengthening from Friday’s close of 4.4425/4.4495.

SPI Asset Management managing partner Stephen Innes expects the currencies of emerging markets with a trade surplus with the US, like Malaysia, to exhibit some weakness.

Major world powers China and Russia are part of the BRICS alliance, along with Brazil, India, South Africa, Iran, Egypt, Ethiopia and the UAE.

“Given that the markets perceived previous Trump tariff threats last week as negotiation tools to extract more concessions from trade partners, this could also be the case with the BRICS tariff threat. Consequently, the market remains in a ‘wait and watch’ mode, gauging whether these declarations will escalate into a full-blown trade war or remain part of Trump’s bargaining strategy,” Innes noted.

The ringgit traded marginally higher against a basket of major currencies.

It edged up against the British pound to 5.6366/5.6493 from 5.6384/5.6473 on Friday, advanced against the euro to 4.6780/4.6885 from 4.6899/4.6973 and went up vis-a-vis the Japanese yen to 2.9578/2.9647 from 2.9589/2.9638

The local note also traded mostly higher against Asean currencies.

It was higher against the Singapore dollar at 3.3078/3.3157 from Friday’s 3.3146/3.3200 and rose against the Philippine peso to 7.57/7.60 from 7.58/7.59.

It also strengthened against the Thai baht to 12.9126/12.9507 from 12.9459/12.9738 and was little changed against the Indonesian rupiah at 280.1/280.9 from 280.2/280.8 previously. - FMT