KUALA LUMPUR: The ringgit opened higher against the US dollar as sentiment improved after the US labour market data showed job growth, reinforcing expectations for cuts in interest rates soon, said an analyst.
At 9 am, the ringgit rose to 4.7140/7190 versus the greenback from yesterday’s close of 4.7165/7215.
Bank Muamalat Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said the US Initial Jobless Claims were lower last week at 187,000 versus consensus estimates of 207,000 while in the prior week, the reading was at 203,000.
“What it means is that the US labour market is still flashing a resilient trend despite the higher interest rate environment.
“This may seem counterintuitive for the rate cut camp who expect rates to be lowered by March this year,” he told Bernama.
The US Dollar Index (DXY) continues to linger above 103 points as the Federal Reserve is not about to change course in the near term, he said.
As such, Mohd Afzanizam expects the ringgit to remain soft today.
Meanwhile, the ringgit was traded mostly higher against a basket of major currencies, except versus the British pound, when it eased to 5.9910/9974 from 5.9782/9845 at Thursday’s close.
It was higher versus the euro at 5.1288/1343 from 5.1339/1394 at Thursday’s close and appreciated vis-a-vis the Japanese yen to 3.1847/1883 from 3.1903/1939 previously.
At the same time, the local note was traded mixed against Asean currencies.
It went up against the Philippines’ peso to 8.44/8.46 from 8.45/8.46 yesterday and inched up versus the Indonesian rupiah to 301.6/302.2 from 301.8/302.3 previously.
The ringgit declined vis-a-vis the Thai baht to 13.2714/2918 from 13.2475/2675 at the close on Thursday and weakened against the Singapore dollar to 3.5101/5140 from 3.5098/5141 previously.