Ringgit weakens against US dollar ahead of Q2 GDP data
At 8 am, the local note depreciated to 4.2100/2210 from Thursday's close of 4.2090/2145.
Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the US dollar received a boost last night as the inflation rate at the producer's level was rising at a fast clip.
'Apart from that, those who applied for unemployment benefits fell last week, which gave the impression that the labour market was still healthy,' he told Bernama.
He noted that the July US Producer Price Index (PPI) rose 3.3 per cent year-on-year, beating the 2.5 per cent forecast, while core PPI climbed to 3.7 per cent versus 2.9 per cent, and the US Initial Jobless Claims came in slightly lower at 224,000 against 225,000 estimates.
'Following this, the US Dollar Index (DXY) rose 0.42 per cent to 98.254 points as traders pared their bets on an interest rate cut by the US Federal Reserve (Fed) in the next Federal Open Market Committee meeting,' he added.
On the local front, Mohd Afzanizam said the ringgit is expected to range between 4.21 and 4.23 against the US dollar today, as the temptation to lock in profits amid uncertainties over the US Fed decision was quite overwhelming.
'The USD-MYR was quite volatile yesterday. It reached RM4.1858 during the morning session but weakened later to RM4.2118.
'It appears that RM4.20 is the psychological level and the USD-MYR did pierce such a level momentarily,' he added.
At the opening today, the ringgit ended higher against major currencies.
It gained against the euro to 4.9047/9175 from 4.9170/9234 on Thursday's close, rose versus the Japanese yen to 2.8502/8578 from 2.8703/8742 and improved vis-a-vis the British pound to 5.6953/7102 from 5.7146/7220 yesterday.
The ringgit traded mixed against regional peers.
It strengthened versus the Singapore dollar to 3.2775/2866 from 3.2849/2895 at yesterday's close and increased versus the Thai baht to 12.9646/13.0069 from 13.0004/0238.
However, the local note inched down against the Indonesian rupiah to 261.2/262.0 from 261.1/261.6 and was almost flat versus the Philippine peso at 7.39/7.42 from 7.39/7.41. - Bernama
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