KUALA LUMPUR, Malaysia (July 8): According to a dealer, the ringgit opened lower versus the US dollar today since market investors were concerned about Malaysia’s political and Covid-19 predicament. The local note opened at 4.1700/1750 against the greenback at 9 a.m., down 95 basis points (bps) from Wednesday’s finish of 4.1605/1625.
The outcome of the UMNO supreme council meeting, when the party opted to withdraw its support for the Perikatan Nasional government led by Prime Minister Tan Sri Muhyiddin Yassin, altered sentiment towards the ringgit, according to Bank Islam Malaysia Bhd economist Adam Mohamed Rahim.
UMNO president Datuk Seri Dr Ahmad Zahid Hamidi made the announcement at the party’s Supreme Council meeting, which was held virtually last night.
“Investors dislike such political uncertainty since national economic ambitions may be postponed,” Adam told Bernama, adding that the situation would put negative pressure on the local currency.
As a result, he expects the ringgit to trade between RM4.16 and RM4.17 against the US dollar today.
Meanwhile, Malaysia reported 7,097 new Covid-19 cases yesterday, down slightly from the 7,654 instances reported the day before.
The ringgit was mixed against a basket of major currencies when the market opened.
The local currency gained ground against the Singapore dollar, rising to 3.0877/0917 from 3.0878/0895 at Wednesday’s close, and against the euro, rising to 4.9164/9223 from 4.9210/9234 the day before.
It declined against the Japanese yen, falling to 3.7724/7769 from 3.7563/7585, and against the British pound, falling to 5.7500/7569 from 5.7452/7480./n
