The ringgit opened higher against the US dollar for the seventh consecutive trading day ahead of the meeting between US President Donald Trump and Chinese President Xi Jinping in Beijing this weekend.
At 10.30am, the ringgit was at 3.9260, up 0.05% against the USD since it opened early Thursday in the Asian session.
Bank Muamalat Malaysia Berhad Chief Economist Mohd Afzanizam Abdul Rashid was of the view that traders are currently expecting a positive outcome from the meeting between the US and Chinese leaders.
The sentiment has helped support the global financial market which was previously depressed by geopolitical tensions and inflation concerns.
He also explained that the increase in fuel prices following the war in West Asia is starting to affect global inflationary pressures. The situation is seen as having the potential to reduce market expectations for an interest rate cut by the Fed in the near future.
At the same time, the price of Brent crude oil continued to remain high with a small increase of 0.08% to US$105.71 per barrel. The high oil price level has raised concerns that cost pressures will continue to weigh on the global economy and keep inflation high for longer than expected.
However, economic uncertainty still haunts the market as global growth is expected to remain under pressure. This opens up the possibility that the US Fed could shift its focus to supporting economic growth if economic momentum slows.
In early morning trade on Thursday, the ringgit was mixed against major currencies. The local currency strengthened against the Japanese yen to 2.4872/4914 from 2.4888/4916 previously, but weakened against the British pound to 5.3110/3198 and the euro to 4.6003/6079.
Against regional currencies, the ringgit mostly performed better. It rose against the Singapore dollar to 3.0859/0915 and strengthened against the Indonesian rupiah to 224.6/225.1.
The ringgit also recorded a small increase against the Philippine peso, but depreciated slightly against the Thai baht.
