By Karina Imran
KUALA LUMPUR, July 22 (Bernama) — The ringgit opened higher against the US dollar and ASEAN currencies, lifted by positive sentiments ahead of the announcement of Malaysia’s inflation rate for June this Wednesday.
At 8 am, the ringgit rose to 4.6815/6910 against the greenback from last Friday’s close of 4.6840/6875.
Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said investors are waiting for the consumer price index (CPI) data to assess the effects of the diesel subsidy rationalisation which was implemented beginning June 10.
Consensus estimates the inflation rate to be at 2.2 per cent, slightly higher than 2.0 per cent in May.
“We sense that the impact is likely to be minimal given that the diesel weight in the CPI basket is only 0.2 per cent. What is more important is how the domestic inflation trajectory will shape the monetary policy decision.
“So far, Bank Negara Malaysia has been crystal clear in their stance towards inflation where the balance of risks is tilted to the upside,” he told Bernama.
This should be positive for the ringgit as the interest rate differential with advanced countries, especially the United States, would be narrowed in the second half of 2024.
Meanwhile, the local note was easier against a basket of major currencies, except against the Japanese yen where it strengthened to 2.9739/9803 from 2.9760/9786 at last Friday’s close.
It depreciated vis-a-vis the British pound to 6.0541/0664 from 6.0452/0497 last week and decreased versus the euro to 5.1024/1127 from 5.0957/0995 previously.
Conversely, the ringgit was higher against ASEAN currencies, rising against the Singapore dollar to 3.4827/4901 from 3.4833/4862 at the close last Friday and inched up versus the Indonesian rupiah to 289.0/289.8 from 289.2/289.6 last week.
It had also appreciated vis-a-vis the Thai baht to 12.8821/9157 from 12.9075/9221 at last Friday’s close and was slightly higher against the Philippines’ peso at 8.02/8.024 from 8.03/8.04 previously.
— BERNAMA
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