KUALA LUMPUR: The ringgit opened marginally lower for the third consecutive trading day against the US dollar today, ahead of the US Federal Reserve’s (Fed) decision on interest rates this week, said a dealer.
At 9 am, the local currency edged down to 4.7260/7310 against the greenback from last Friday’s close of 4.7225/7275.
In a note, Kenanga Research said despite expectations of Bank of England’s 75 basis points (bps) rate hike, the continuation of the Fed’s super-sized interest rate hike and Bank of Japan’s ultra-loose monetary policy may boost the USD index (DXY) to recover to around the 112.0 level, hence weakening the ringgit.
“However, the local note is expected to stay supported around the 4.73 to 4.75 level, backed by Bank Negara Malaysia’s expected 25 bps overnight policy rate hike at its Monetary Policy Committee meeting on Nov 2-3,” it said.
From a technical point of view, the US dollar may recoup some of its losses if market sentiment turned more bearish, said Kenanga Research.
In the week ahead, the US central bank is likely to deliver another 75 bps rate hike on Wednesday, which would bring benchmark lending rates to 4 per cent.
Back home, the ringgit was traded mostly lower against a basket of major currencies, except against Japanese yen.
The local note slipped against the British pound to 5.4850/4908 from 5.4455/4513 at Friday’s close, eased versus the Singapore dollar to 3.3470/3510 from 3.3436/3474 and depreciated against the euro to 4.7062/7111 from 4.7008/7058 previously.
However, it rose vis-a-vis the Japanese yen at 3.1881/1919 from 3.1976/2012 on Friday.-BERNAMA