Ringgit opens firmer against US dollar

KUALA LUMPUR - The ringgit opened slightly higher against the US dollar on Tuesday after the release of the United States (US) ISM manufacturing purchasing managers' index (PMI) which came in lower than expected at 46.0 points in June, said an economist.

At 9 am, the local unit rose marginally to 4.6635/6670 versus the greenback compared to 4.6640/6690 at Monday’s close.

Bank Muamalat Malaysia Bhd chief economist and social finance head Dr Mohd Afzanizam Abdul Rashid said the ringgit is well supported as the data indicate that the Federal Reserve may not be so hawkish although it may be inclined to maintain higher for longer narratives to clamp down inflation.

"US manufacturing continues to exhibit further weaknesses in June. The index has been below the 50-point demarcation line for eight months in a row since November last year, indicating that manufacturers had become pessimistic in the first half of 2023.

"Such reading suggests that the past monetary tightening had taken a toll on the economic activities with inflation as reflected by the core Personal Consumption Expenditure (PCE) which moderated to 4.6 per cent in May from as high as 5.4 per cent in February 2022," he told Bernama.

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

It fell vis-a-vis the euro to 5.0879/0917 from 5.0791/0845 at Monday’s close, weakened against the Japanese yen to 3.2280/2307 from 3.2252/2289 and decreased versus the British pound to 5.9212/9257 from 5.9088/9152 previously.

The local note also traded mostly lower against other Asean currencies.

The ringgit was down against the Singapore dollar to 3.4539/4570 versus 3.4482/4521 on Monday, slipped against the Thai baht to 13.3098/3263 from 13.2357/2563 and fell against the Philippine peso to 8.44/8.46 from 8.43/8.44.

It was flat against the Indonesian rupiah at 310.2/310.6 from 310.2/310.7 on Monday. - BERNAMA