The ringgit opened higher against the US dollar today, buoyed by the continued weakness of the US dollar amid growing concerns about the fiscal trajectory and instability in US trade policy.
At 10.30am, the ringgit was at 4.2150 against the USD, unchanged since it opened early on Tuesday.
Bank Muamalat Malaysia Bhd Chief Economist Dr Mohd Afzanizam Abdul Rashid said the US Dollar Index (DXY) had extended its downtrend, falling to 98.934 points, as investors grew wary of the direction of US trade policy under President Donald Trump.
He added that the delay in implementing the 50% tariff on European Union goods until July 9 signaled uncertainty in the Donald Trump administration's trade stance and weighed on US dollar confidence.
In addition, expansionary fiscal measures could widen the US fiscal deficit and increase the country's debt level, further weighing on sentiment towards US market assets.
Mohd Afzanizam said against this backdrop, emerging market currencies, including the ringgit, continued to rise, supported by improved capital inflows and better risk appetite.
Meanwhile, the ringgit traded higher against a basket of major currencies at the close.
It rose against the euro to 4.7903/8131 from 4.7972/8046, rose against the British pound to 5.7058/7329 from 5.7175/7263, and rose against the Japanese yen to 2.9500/9643 from 2.9506/9553 on Monday.
The local note also traded higher against its ASEAN peers.
It rose against the Singapore dollar to 3.2757/2915 from 3.2826/2879, strengthened against the Thai baht to 12.8992/9745 from 12.9231/9466, rose against the Philippine peso to 7.58/7.63 from 7.60/7.62 to the rupiah and rose against the Indonesian rupiah to 258.7/260.1 from 259.4/259.9 previously.
