Ringgit opens higher on buying interest

Ringgit opens higher on buying interest

KUALA LUMPUR,. The ringgit opened higher against the US dollar on Friday, as buying interest in the local note reemerged ahead of the tabling of Budget 2022 later today, said a dealer.

At 9am, the local note rose to 4.1445/1480 versus the greenback from 4.1485/1520 at yesterday’s close.

Bank Islam chief economist Dr Mohd Afzanizam Abdul Rashid said traders are waiting for the budget announcement as it could be a decisive factor in determining their confidence with regards to the ringgit’s performance.

In early January 2021, the domestic unit breached the 4.00-level against the US dollar, depreciating to a year-to-date low of 4.24 mid-August before regaining its grounds to trade at the current level of between 4.14 and 4.19.

He said the ringgit looks favourable at the moment after piercing the previous support level of RM4.1498.

“The next support level would be at RM4.1203. Higher commodity prices alongside positive economic data may have contributed to the positive tone in the ringgit.

“Nonetheless, there could be some profit-taking activities as the ringgit is seen to be in an overbought position from the technical standpoint,” he told Bernama.

He said with the tabling of Budget 2022 later today, key macroeconomic indicators such as fiscal deficits and gross domestic product targets will be closely watched.

These parameters will determine how the government would use its resources to generate growth and how it may impact the monetary policy in respect of the overnight policy rate next year, said Mohd Afzanizam.

“Generally speaking, the ringgit looks set to stage further appreciation,” he added.

Meanwhile, at the opening, the ringgit was traded lower against a basket of major currencies.

It had eased against the Japanese yen to 3.6499/6533 from 3.6493/6527 at Thursday’s close, and fell against the euro to 4.8428/8469 from 4.8094/8134 yesterday.

The local note had also slipped versus the Singapore dollar to 3.0835/0863 from 3.0778/0808 on Thursday and eased vis-a-vis the British pound to 5.7173/7222 from 5.7075/7123 previously. — Bernama

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