KUALA LUMPUR: The ringgit traded in a narrow range as the US dollar continued to firm amid nervous sentiments following concerns over the bleak outlook for the global economy after disappointing China and European data.
At 9 am, the local note fell to 4.6715/6760 against the greenback from Tuesday’s close of 4.6615/6655.
Bank Muamalat Malaysia Bhd chief economist and social finance head Dr Mohd Afzanizam Abdul Rashid said higher US Treasury yields also hurt demand for emerging currencies.
The long-dated US Treasury securities yielded higher by eight basis points to 4.26 per cent, while the US Dollar Index (DXY) rose 0.52 per cent to 104.776 points.
He said data points in Europe showed that the Purchasing Managers’ Index (PMI) for the services economy fell short of expectations to 47.9 points in August, while the Producer Price Index (PPI) declined 7.6 per cent in July, the third consecutive month of negative print.
On top of that, European Central Bank president Christine Lagarde was also somewhat vague about next week’s Governing Council meeting next week.
“The possibility of a rate hike pause should not be ruled out premised on the inflation trajectory. In that sense, this will support the US dollar more as the Federal Reserve is likely to keep a hawkish view on rates.
“Therefore, the US dollar/ringgit pair shall remain in a narrow range of 4.65 to 4.66,” he told Bernama.
At home, the Monetary Policy Committee meeting will be convened today and will release its statement tomorrow, with the market expecting no changes in the overnight policy rate (OPR).
The ringgit traded mostly higher against a basket of major currencies.
It increased against the euro to 5.0074/0122 from 5.0088/0131 at Tuesday’s close and rose vis-a-vis the Japanese yen to 3.1611/1644 from 3.1670/1699 but depreciated against the British pound to 5.8660/8717 from 5.8534/8585 and
The ringgit traded mostly lower against other Asean currencies.
It was lower against the Singapore dollar to 3.4299/4334 from 3.4238/4272 at Tuesday’s close, went down versus the Thai baht to 13.1414/1592 from 13.1388/1567, was weaker against the Indonesian rupiah at 305.8/306.3 from 305.2/305.6 and was flat against the Philippine peso at 8.19/8.22 from 8.19/8.21.
US dollar rises amid global economic concerns
The US dollar increased in late trading on Tuesday, as economic data from the European Union, Britain, and Japan boosted the US currency, reported Xinhua.
The dollar index, which measures the greenback against six major peers, was up 0.66 per cent to 104.8080 in late trading.
Hamburg Commercial Bank (HCOB)’s final Composite Purchasing Managers’ Index (PMI), released Tuesday by S&P Global, dropped to 46.7 in August from July’s 48.6, a low not seen since November 2020.
“The eurozone didn’t slip into recession in the first part of the year, but the second half will present a greater challenge,” said Cyrus de la Rubia, chief economist at Hamburg Commercial Bank. “The disappointing numbers contributed to a downward revision of our GDP which stands now at -0.1 percent for the third quarter.”
In late New York trading, the euro fell to US$1.0721 from US$1.0795 in the previous session, and the British pound decreased to US$1.2566 from US$1.2631.
Meanwhile, a rise in oil prices has reignited global inflationary concerns. West Texas Intermediate crude prices have climbed 7 percent in two weeks. While the US oil benchmark was down 0.3 per cent on Tuesday, it remains near its highest level since mid-November 2022.
Bond yields move inversely to prices, so a selloff in bonds pushed yields higher. The yield on the benchmark 10-year US Treasury note rose above 4.23 per cent on Tuesday.
The US dollar bought 147.7660 Japanese yen, higher than 146.4900 Japanese yen of the previous session. The US dollar increased to 0.8896 Swiss francs from 0.8842 Swiss francs, and it increased to 1.3638 Canadian dollars from 1.3593 Canadian dollars. The US dollar was up to 11.1026 Swedish krona from 11.0071 Swedish krona.
Short-terms rates remain stable
Short-term rates are expected to remain stable today on Bank Negara Malaysia’s (BNM) operations to absorb surplus liquidity from the financial system.
Liquidity is estimated at RM39.84 billion in the conventional system and RM22.28 billion in Islamic funds.
Today, the central bank will conduct two conventional money market tenders worth RM1 billion for seven days and RM500 million for 14 days.
It will also call for two reverse repo tenders, comprising a RM1.5 billion tender for 30 days and a RM500 million tender for 91 days as well as RM3 billion Bank Negara Interbank Bills (BNIB) for 31 days.
BNM also announced the availability of reverse repo, sale and buy-back agreements as well as collateralised commodity murabahah facilities for tenors of one to three months.
At 4 pm, it will conduct up to RM40.3 billion conventional overnight tender and RM22.4 billion for murabahah overnight tender.
Foreign exchange rates
Following are the opening Malaysian foreign exchange for major currencies today:
1 USD 4.6715/6760
100 yen 3.1611/1644
1 pound 5.8660/8717
1 euro 5.0074/0122
1 SGD 3.4299/4334
100 baht 13.1414/1592
1 mln rupiah 305.8/306.3
100 pesos 8.19/8.22
Exchange rates issued by Malayan Banking Bhd today
| SELLING TT/OD | BUYING TT | BUYING OD | |
| 1 US Dollar | 4.7370 | 4.6040 | 4.5800 |
| 1 Australian Dollar | 3.0380 | 2.9190 | 2.9290 |
| 1 Brunei Dollar | 3.4800 | 3.3810 | 3.3780 |
| 1 Canadian Dollar | 3.4700 | 3.3790 | 3.3670 |
| 1 Euro | 5.0890 | 4.9260 | 4.9240 |
| 1 New Zealand Dollar | 2.7980 | 2.6970 | 2.6980 |
| 1 Papua N Guinea Kina | N/A | N/A | N/A |
| 1 Singapore Dollar | 3.4800 | 3.3810 | 3.3780 |
| 1 Sterling Pound | 5.9620 | 5.7780 | 5.7380 |
| 1 Swiss Franc | 5.3120 | 5.1930 | 5.1820 |
| 100 UAE Dirham | 130.5600 | 123.8500 | 123.2700 |
| 100 Bangladesh Taka | 4.4000 | 4.1150 | 3.9020 |
| 100 Chinese Renminbi | 65.3300 | 62.6000 | N/A |
| 100 Danish Krone | 69.9700 | 64.4200 | 64.4500 |
| 100 Hongkong Dollar | 61.0900 | 58.0800 | 57.7400 |
| 100 Indian Rupee | 5.8000 | 5.4500 | 5.2500 |
| 100 Indonesian Rupiah | 0.0321 | 0.0291 | 0.0241 |
| 100 Japanese Yen | 3.2160 | 3.1150 | 3.1170 |
| 100 New Taiwan Dollar | 15.9000 | N/A | N/A |
| 100 Norwegian Krone | 45.3800 | 41.7500 | 41.4500 |
| 100 Pakistan Rupee | 1.5700 | 1.4700 | 1.2700 |
| 100 Philippine Peso | 8.4400 | 7.9600 | 7.7800 |
| 100 Qatar Riyal | 131.5000 | 124.8400 | 124.2500 |
| 100 Saudi Riyal | 127.7900 | 121.3200 | 120.7500 |
| 100 South Africa Rand | 25.6400 | 23.1600 | 22.8700 |
| 100 Sri Lanka Rupee | 1.5200 | 1.3900 | 1.1900 |
| 100 Swedish Krona | 44.0300 | 40.1200 | 40.1500 |
| 100 Thai Baht | 13.9700 | 12.3800 | 12.0200 |
Gold up
The physical price of gold as at 9.30 am stood at RM279.71 per gramme, down 50 sen from RM280.21 at 5 pm yesterday. – BERNAMA
