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Ringgit opens lower as US dollar continues gains

ringgit-opens-lower-as-us-dollar-continues-gains

KUALA LUMPUR,. The ringgit opened weaker against the US dollar as the latter continued to gain traction on the back of the United States (US) Federal Reserve’s (Fed) increasingly hawkish tone.

The Federal Open Market Committee’s (FOMC) decision to double up on scaling back the purchases of assets by US$30 billion (RM126.8 billion) a month would put the Fed’s quantitative easing programme on track to conclude by March 2022 — several months ahead of the initial schedule.

At 9.20am, the local note stood at 4.2270/2300 against the greenback compared with Friday’s close of 4.2190/2210.

In a note today, Kenanga Research said the move paves the way for earlier rate increases next year, with all 18 FOMC members expecting at least one hike in 2022, whilst 12 members predict three 0.25 basis points rate hikes.

Hence, the ringgit may depreciate by 0.01 per cent to 4.22 level this week, it said.

It also estimates the ringgit to continue declining due to the ongoing fears regarding the Omicron variant.

Meanwhile, the ringgit was mostly lower vis-a-vis a basket of other major currencies, except against the euro where it rose to 4.7520/7554 from 4.7805/7828.

It fell against the British pound to 5.5906/5946 from 5.6180/6203 last Friday, decreased against the Singapore dollar to 3.0915/0941 from 3.0899/0919 and slipped versus the Japanese yen to 3.7206/7236 from 3.7139/7160 previously. — Bernama

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