Ringgit opens higher against greenback amid weaker US economic data
KUALA LUMPU: The ringgit opens marginally higher against the US dollar on Thursday, amid weaker-than-expected United States (US) economic data and tariff uncertainties, an analyst said.
At 8 am, the local note inched up to 4.2410/2495 versus the greenback from Wednesday's close of 4.2435/2490.
Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the US Dollar Index (DXY) was down by 0.44 per cent to 98.787 points, as economic indicators surprised on the downside.
He said the US Institute for Supply Management (ISM) Index for the services sector fell below the 50-point demarcation line to 49.9 in May, defying consensus estimates of 52.0 points.
"Based on the survey response by the ISM, import tariff was the major source of uncertainties among businesses as it has raised the raw material prices, and some suppliers are holding back inventory given the tariff uncertainties.
"This may lead to stronger emerging market currencies, including as the traders and investors would be reassessing the strength of the US economy, and therefore, Friday's Nonfarm Payroll will be another important barometer to look at," he told Bernama.
He also noted that the upcoming Federal Open Market Committee meeting on June 16-17 would be another critical milestone, as the US Federal Reserve staff will issue their latest macroeconomic forecast for the next three years.
At the opening, the ringgit traded lower against a basket of major currencies.
It slid against the Japanese yen to 2.9705/9767 from Wednesday's close of 2.9444/9486, fell vis-a-vis the euro to 4.8428/8525 from 4.8300/8362, and depreciated against the British pound to 5.7466/7581 from 5.7427/7502 previously.
The local note also traded mostly lower against its ASEAN peers.
It traded flat versus the Philippine peso at 7.60/7.62, unchanged from its close on Wednesday.
However, the ringgit declined against the Singapore dollar to 3.2973/304 from 3.2906/2951 on yesterday's close, weakened versus the Thai baht to 13.0132/0493 from 12.9679/9911, and eased versus the Indonesian rupiah at 260.2/260.8 compared to 260.4/260.8 previously.
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