The Malaysian ringgit (RM) opened higher against the US dollar in the early Asian trading session after last night's US Gross Domestic Product (GDP) report which showed the country's economy growing by 2.5% by the end of 2023.
A sharp increase from the 1.9% growth recorded in 2022 as well as the report boosted demand for the US dollar.
At exactly 9.05 this morning, the ringgit moved slightly to 4.7360 against the US dollar from 4.7280 at yesterday's close.
According to the Managing Director of SPI Assets, Stephen Innes said that although the market now shows that the US economy is strengthening and strengthening the US dollar. However, the overall impact may not be significant due to the fact that conflicts are still prevalent.
The foreign exchange market is currently focusing on critical price data especially in anticipation of upcoming releases such as December's core US Personal Consumption Expenditure (PCE) tonight and January's Consumer Price Index (CPI) released in mid-February.
Expectations for December core PCE remain subdued with an expected increase of 0.2% month-on-month in line with the Fed's inflation metric priorities.
Meanwhile, he said that the January CPI figures in early February will reveal the next market risk.
However, the ringgit is trading high against the world's major currencies. It strengthened slightly against the British pound and the euro. However, the position of the Japanese yen is slightly weaker.
The local currency is also strong against several other Asean currency groups. It rose against the Singapore dollar, the Thai baht, the Philippine peso and the Indonesian rupiah.
