Ringgit strengthens broadly on cautious trade sentiment
At 8 am, the local note stood at 4.2110/2310 versus the greenback, compared with Friday's close of 4.2195/2245.
Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said that earlier, the US and the European Union (EU) had agreed to a 15 per cent tariff on most EU imports, while most US imports would face zero tariff under the deal.
He said markets are also closely watching the upcoming US Federal Open Market Committee (FOMC) meeting scheduled for July 29 and 30, with consensus expecting no change to the Federal Funds Rate, currently at 4.25 per cent to 4.50 per cent.
"Based on recent developments, most countries appear accommodative in offering favourable terms to the US. It remains to be seen whether this will effectively narrow the trade balance in the near term.
"However, the cost of doing business in the US is likely to rise, and it also appears the US may be relying on a weaker dollar to boost export competitiveness.
"Against this backdrop, we expect the ringgit to remain within a narrow range of RM4.22 to RM4.23 versus the US dollar,' Mohd Afzanizam told Bernama.
At opening here, the ringgit traded mostly higher against a basket of major currencies.
It rose against the Japanese yen to 2.8499/2863 from 2.8529/8565 at Friday's close, and strengthened versus the British pound to 5.6600/6869 from 5.6786/6853. However, it eased slightly against the euro to 4.9521/9757 from 4.9507/9566.
Against regional peers, the ringgit was also firmer.
It advanced against the Indonesian rupiah to 258.0/259.3 from 258.5/258.9 on Friday, and gained versus the Singapore dollar at 3.2878/3039 from 3.2937/2978.
The local note also strengthened against the Thai baht to 12.9809/13.0546 from 13.0268/0478, and edged up against the Philippine peso to 7.37/7.41 from 7.38/7.40 previously. - Bernama
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