KUALA LUMPUR: The ringgit rose against the US dollar this morning as demand for the domestic currency improved following the recent selloff and as US bond yields retreated from 16-year highs, said an analyst.
At 9.03 am, the local note rose to 4.6930/6975 against the greenback from Wednesday’s close of 4.7055/7105.
The market was closed on Thursday in conjunction with Prophet Muhammad’s Birthday (Maulidur Rasul).
“This is very much a ‘bad news is good news’ environment as traders perceive bad US economic news in a favourable light as it should temper the US Federal Reserve’s (Fed) rate hike cycle and higher for longer interest rate expectations. Hence, border forex markets have reduced long US dollar positions,” SPI Asset Management managing partner Stephen Innes told Bernama.
He said the global risk appetite looked more favourable on the back of higher US stock markets, lower US bond yields and improving industrial earnings in China, which should offer some breathing room for the maligned ringgit.
The ringgit was traded mostly higher against a basket of major currencies.
It advanced against the euro at 4.9567/9615 from Wednesday’s closing of 4.9690/9743, went up against the Japanese yen to 3.1412/1445 from 3.1534/1570 but depreciated against the British pound at 5.7250/7305 from 5.7167/7228.
At the same time, the local note was also traded mixed against other Asian currencies.
It improved against the Thai baht at 12.8119/8298 from 12.8759/8949 on Wednesday and was higher against the Indonesian rupiah at 302.3/302.8 from 303.1/303.6 previously.
It was a little changed against the Philippine peso at 8.27/8.28 from 8.26/8.28 on Wednesday and decreased against the Singapore dollar to 3.4351/4386 from 3.4334/4373 previously.
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 RM46.21 billion in the conventional system and RM17.45 billion in Islamic funds.
Today, the central bank will conduct two conventional money market tenders, consisting of a RM1.0 billion tender for seven days and a RM500 million tender for 14 days.
It will also conduct two Qard tenders, comprising a RM1.0 billion tender for seven days and a RM500.0 million tender for 14 days.
The central bank will also conduct two reverse repo tenders, comprising a RM1.5 billion tender for 32 days and a RM500 million tender for 91 days.
It also announced the availability of reverse repo, sale and buy-back agreements and Collateralised Commodity Murabahah facilities for one-month and three-month tenors.
BNM also announced that it will be issuing a RM2.0 billion Bank Negara Interbank Bills tender for 31 days on Oct 3.
At 4 pm, it will conduct up to RM50.6 billion conventional overnight tender and RM16.2 billion for Murabahah overnight tender.
Foreign exchange rates
Following are the opening Malaysian foreign exchange for major currencies today:
1 USD 4.6930/6975
100 yen 3.1412/1445
1 pound 5.7250/7305
1 euro 4.9567/9615
1 SGD 3.4351/4386
100 baht 12.8119/8298
1 mln rupiah 302.3/302.8
100 pesos 8.27/8.28
Gold down
The physical price of gold as at 9.30 am stood at RM272.02 per gramme, down RM5.25 from RM277.27 at 5 pm last Wednesday. — BERNAMA
