Kuala Lumpur: The ringgit opened slightly lower against the US dollar on Friday, weighed by stronger-than-expected US economic data which supported the greenback.
Bank Muamalat Malaysia Bhd chief economist Afzanizam Rashid said the US producer price index (PPI) rose more than expected to 5.4% year-on-year in August, up from 4.8% in July, versus consensus estimates of 5.3%.
Meanwhile, core PPI also rose to 4.6% from 4.3% previously, while the US Dollar Index (DXY) increased 0.26% to 99.077 points.
“It seems businesses are inclined to pass on their rising costs to consumers, which means that the consumer price index (CPI) could stay elevated when it is published tonight.
“Hence, the potential US interest rate hike thesis is gaining momentum, leading to a higher US Dollar,” he told Bernama.
“It seems businesses are inclined to pass on their rising costs to consumers, which means that the consumer price index (CPI) could stay elevated when it is published tonight.
“Hence, the potential US interest rate hike thesis is gaining momentum, leading to a higher US Dollar,” he told Bernama.
The ringgit traded higher against most major currencies at the opening.
It gained against the Japanese yen to 2.6337/2.6381 from 2.6431/2.6459 at yesterday’s close, inched up against the euro to 4.7238/4.7313 from 4.7269/4.7315, and rose against the British pound to 5.4967/5.5055 from 5.5046/5.5100.
Against regional currencies, the ringgit traded mixed.
It strengthened against the Singapore dollar to 3.2082/3.2136 from 3.2113/3.2148 at the previous close, and gained versus the Thai baht to 12.2696/12.2948 from 12.3331/12.3497 previously.
However, the local note was little changed against the Indonesian rupiah to 231.8/232.3 from 231.5/231.8, while it slipped vis-a-vis the Philippine peso to 6.50/6.52 from 6.49/6.50, previously.
