KUALA LUMPUR: The ringgit opened slightly higher versus the US dollar and is likely to trade sideways today as market participants await the Federal Open Market Committee (FOMC) meeting outcome tonight, said an analyst.
Bank Muamalat Malaysia Bhd chief economist Afzanizam Rashid said any signs of a dovish tilt by the US Federal Reserve (Fed) would be positive for the ringgit.
“This would be embedded in the FOMC statement when it publishes its verdict tonight and the latest quarterly projection for the macroeconomic variable in 2024, 2025 and 2026.
“I suppose it’s going to be a wait and see attitude today,” he noted.
On the announcement of the Malaysian Cabinet reshuffle on Tuesday, he said this has yet to have a positive impact on the ringgit.
However, changes to the Cabinet line-up should be positive for the currency market in the medium term as there should be more clarity on policy implementation and outcome, he added.
Meanwhile, ActivTrades trader Dyogenes Rodrigues Diniz said the range-bound trading today is also due to the sentiment of indecision as a result of the US Consumer Price Index (CPI) data which came in as expected at 3.1%.
The core CPI data was also in line with market expectations at 4.0%.
“When data is as expected, the market tends to show indecision,” he said.
At 9am, the ringgit edged up to 4.6815/4.6888 against the US dollar from Tuesday’s close of 4.6830/4.6855.
The ringgit was also traded better versus a basket of major currencies.
It rose against the British pound to 5.8790/5.8872 from 5.8842/5.8873 at Tuesday’s close, appreciated vis-a-vis the euro to 5.0532/5.0602 from 5.0548/5.0575 and strengthened against the Japanese yen to 3.2173/3.2220 from 3.2212/3.2232.
The ringgit also traded higher against other Asean currencies.
It went up versus the Philippine peso to 8.40/8.42 from Tuesday’s closing of 8.42/8.43, and slightly improved against the Indonesian rupiah to 299.6/300.2 from 299.7/300.1.
The local note was marginally firmer versus the Singapore dollar at 3.4890/3.4941 compared with 3.4898/3.4920 and ticked up against the Thai baht to 13.0988/13.1239 from 13.1261/13.1390. - FMT
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