The ringgit continued its upward momentum against the US dollar on Tuesday, boosted by fresh investor appetite following several US-Malaysia trade deals that boosted confidence in the local currency.
At 10am, the ringgit was at 4.2020, up 0.07% against the US dollar since it opened early Tuesday in the Asian session.
Bank Muamalat Malaysia Bhd Chief Economist Dr Mohd Afzanizam Abdul Rashid said the recent trade deals were expected to provide further support to the ringgit as Malaysia maintained strong diplomatic and economic ties with its trading partners.
He added that the country’s foreign and trade policies have consistently been geared towards promoting greater global integration, especially in areas related to supply chains.
Meanwhile, the US Dollar Index weakened by 0.17% to 98.783 points as confidence grew on the potential for success in trade talks between the United States and China, ahead of a scheduled meeting between the two leaders on Thursday.
Market sentiment was also boosted by expectations of a 25 basis point interest rate cut by the US Fed on Thursday, further weighing on the US dollar.
Based on market confidence, the ringgit could make another attempt to break through the RM4.20 level today.
At the opening, the ringgit was also trading higher against most major currencies.
It rose against the Japanese yen to 2.7538/7606 from 2.7550/7582 on Monday, and rose against the British pound to 5.6077/6211 from 5.6158/6225. However, it depreciated slightly against the euro to 4.8981/9097 from 4.8974/9032.
Among ASEAN currencies, the local currency strengthened against most regional currencies.
It rose against the Singapore dollar to 3.2433/2513 from 3.2460/2502, appreciated against the Indonesian rupiah to 252.9/253.6 from 253.1/253.6, and strengthened against the Philippine peso to 7.13/7.16 from 7.14/7.16.
The ringgit, however, depreciated slightly against the Thai baht to 12.8767/9145 from 12.8633/8837 at Monday's close.
