KUALA LUMPUR, Oct 29 — The ringgit extended its gains for the seventh day on Thursday, opening higher against the United States (US) dollar, supported by the much-anticipated 25 basis points cut last night by the US Federal Reserve (US Fed).
At 8am, the ringgit appreciated to 4.1835/2050 against the greenback from Wednesday’s close of 4.1850/1900.
However, Bank Muamalat Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said the decision comes with a catch.
“Monetary policy is not a preset course, and views are polarised among Federal Open Market Committee (US FOMC) members.
"The gap between the US federal funds rate (FFR) and Malaysia's overnight policy rate (OPR) will not be narrowed soon enough. US dollar returns may look attractive to some degree," he told Bernama.
Afzanizam added that the ringgit could experience some profit-taking after staging significant gains, following the dollar-ringgit's passing of the RM4.20 psychological level. The local unit could range between RM4.19 and RM4.20 today.
At the opening, the ringgit traded higher against most major currencies.
It rose against the Japanese yen to 2.7383/7525 from 2.7493/7528 at Wednesday's close, strengthened against the British pound to 5.5189/5472 from 5.5326/5392 and climbed versus the euro to 4.8533/8782 from 4.8722/8780.
The local note also mainly traded higher against most Asean currencies.
It improved against the Singapore dollar to 3.2245/2416 from 3.2324/2365 at Wednesday’s close and inched up vis-à-vis the Indonesian rupiah to 251.7/253.1 from 251.8/252.2.
The ringgit gained against the Thai baht to 12.9096/9840 from 12.9651/9858, but was almost flat against the Philippine peso at 7.12/7.16 from 7.12/7.14 previously.
