The ringgit traded higher against the US dollar in early trading

KUALA LUMPUR: The ringgit continued to post gains to open higher against the US dollar in early trading today following the United States (US) currency’s low on rising expectations of global interest rate cuts this year, economists said.

According to Bernama, at 9 am, the ringgit rose to 4.7080/7130 against the US dollar from 4.7110/7155 yesterday.

Bank Muamalat Malaysia Bhd Chief Economist Dr Mohd Afzanizam Abdul Rashid said the ringgit is expected to strengthen with the possibility that lower US interest rates will reduce the rate difference between the Fed funds rate and the overnight policy rate (OPR).

Reported Federal Reserve Governor Adriana Kugler in a speech on Tuesday stated that it is appropriate for the central bank to lower its interest rates at the end of the year due to the economic situation moving on the right track.

In that regard, Afzanizam said the local currency is traded on an upward trend compared to other regional currencies.

“Perhaps, policy reforms such as the rationalization of diesel subsidies have contributed positively to the strengthening of the ringgit,” he said.

Meanwhile, the ringgit traded lower against a group of major currencies.

The local currency slipped against the Japanese yen to 2.9818/9852 from 2.9798/9828 on Tuesday, slipped against the pound to 5.9810/9874 from 5.9750/9807 and was lower against the euro to 5.0555/0608 from 5.0492/0541 previously.

Local currencies are traded mixed compared to ASEAN currencies.

It was higher against the Indonesian rupiah to 286.8/287.2 from 287.0/287.3 on Tuesday and strengthened against the Philippine peso to 8.02/8.04 from 8.03/8.05.

It eased against the Singapore dollar to 3.4838/4878 from 3.4793/4829 yesterday and eased against the Thai baht to 12.8322/8507 from 12.7874/8048.