KUALA LUMPUR, Malaysia (July 6): The ringgit started the day slightly higher against the US dollar, boosted by rising crude oil prices. The local currency rose to 4.1555/1590 against the greenback at 9 a.m., up from 4.1560/1575 at yesterday’s close.
Brent crude, the international oil benchmark, was 0.09 percent higher at US$77.23 (about RM321.08) per barrel at the time of writing.
According to Bank Islam Malaysia Bhd economist Adam Mohamed Rahim, there was a fallout yesterday during the Organization of the Petroleum Exporting Countries and Allies (OPEC+) meeting between the United Arab Emirates (UAE) and Saudi Arabia, so a proposed increase in oil output of about two million barrels per day from August would not take place.
“This could lead to oil market supply tightening and higher oil prices, which is good for the ringgit,” he told Bernama.
However, Adam believes that any attempt in the meeting to resolve the UAE-Saudi Arabia issue by likely moving ahead with the transaction and discussing a new UAE baseline as part of a new deal could limit Brent crude oil price advances in the future.
“Overall, we expect the Malaysian ringgit to rise somewhat today, to a range of RM4.15 to RM4.16,” he said.
Meanwhile, the ringgit was largely trading higher versus a basket of major currencies at the opening bell.
The local currency strengthened against the euro, rising to 4.9288/9330 from 4.9357/9374 at yesterday’s closing, and against the Japanese yen, rising to 3.7481/7516 from 3.7495/7512. It also strengthened against the Singapore dollar, rising to 3.0882/0910 from 3.0900/0915 yesterday.
However, it fell to 5.7587/7635 against the British pound, down from 5.7577/7598 before./n
