KUALA LUMPUR: The ringgit fell against the US dollar this morning as the greenback continued to be buoyed by bullish sentiments.
At 9.15 am, the local note slid to 4.7050/7095 against the US dollar from Tuesday’s close of 4.6875/6915
ActivTrades trader Dyogenes Rodrigues Diniz said the market continues to believe that a rise in interest rates is on the cards for the United States (US) Federal Reserve.
He noted that the US Conference Boards’ Consumer Confidence came in slightly lower than expected at 103.0 versus the forecasted 105.5, while the New Home Sales data for August also came in slightly lower than expected at 675,000 against the forecast of 700,000.
“Although lower-than-expected readings tend to be negative for the US dollar, since the difference was small, the market maintained its bullish direction from the previous days,” he said in a note today.
From the technical point of view, despite the upward movement today, Diniz said the market has not yet managed to break above the lateralisation over the last few days.
“A bullish move could happen if the US dollar/ringgit manages to break above 4.6970 in the coming days,” he added.
Meanwhile, the ringgit was traded lower against a basket of major currencies.
It eased against the euro at 4.9694/9742 from Tuesday’s closing of 4.9673/9716, depreciated against the British pound at 5.7147/7202 from 5.7117/7166 and declined against the Japanese yen to 3.1573/1605 from 3.1489/1518 yesterday.
At the same time, the local note was also traded lower against other Asian currencies.
It went down against the Thai baht to 12.9038/9211 from 12.8884/9043 on Tuesday and slipped against the Indonesian rupiah to 303.6/304.1 from 302.5/303.0 previously.
It had also slid against the Philippines’ peso at 8.25/8.27 from 8.23/8.24 on Tuesday and decreased against the Singapore dollar to 3.4353/4391 from 3.4275/4310 previously.
Gold falls on strong US dollar
Gold futures on the COMEX division of the New York Mercantile Exchange fell on Tuesday as the US dollar strengthened, reported Xinhua.
The most active gold contract for December delivery fell 16.80 US dollars, or 0.87 per cent, to close at 1,919.80 dollars per ounce.
US dollar index has risen to 10-month high, and US Treasury yields at 16-year peak.
In an event held by the Wharton School of the University of Pennsylvania on Monday, Minneapolis Federal Reserve Bank President Neel Kashkari said that given the surprising resilience of the US economy, the Fed probably needs to raise borrowing rates further and keep them high for some time to bring inflation back down to 2 per cent.
Economic data released Tuesday were mixed. The Conference Board’s consumer confidence fell for the second month in a row to 103 in September, below economists’ consensus for a reading of 105 and August’s upwardly revised reading of 108.7.
The S&P CoreLogic Case-Shiller US National Home Price NSA Index, covering all nine US census divisions, grew one per cent year on year in July, up from a 0-percent change in June.
The US Commerce Department reported that US sales of newly built homes fell 8.7 per cent in August from July to a seasonally adjusted annualised pace of 675,000 units. This is the slowest pace since March.
Investors are awaiting the release of the personal consumption expenditures (PCE) price index, the Federal Reserve’s preferred inflation gauge, on Friday.
Silver for December delivery fell 18.90 cents, or 0.81 per cent, to close at 23.196 dollars per ounce. Platinum for October delivery fell 10.40 dollars, or 1.13 per cent, to close at 907.10 dollars per ounce.
Short-terms rates remain stable
Short-term rates are expected to remain stable today on Bank Negara Malaysia’s (BNM) operations to absorb surplus liquidity from the financial system.
Liquidity is estimated at RM46.21 billion in the conventional system and RM17.45 billion in Islamic funds.
Today, the central bank will conduct two conventional money market tenders, consisting of a RM1 billion tender for seven days and a RM500 million tender for 14 days.
It will also conduct two reverse repo tenders, comprising a RM1.5 billion tender for 30 days and a RM500 million tender for 91 days.
BNM also announced that it will be issuing a RM3 billion Bank Negara Interbank Bills tender for 31 days on Oct 2.
At 4 pm, it will conduct up to RM45.7 billion conventional overnight tender and RM17.7 billion for Murabahah overnight tender.
Foreign exchange rates
Following are the opening Malaysian foreign exchange for major currencies today:
1 USD 4.7050/7095
100 yen 3.1573/1605
1 pound 5.7147/7202
1 euro 4.9694/9742
1 SGD 3.4353/4391
100 baht 12.9038/9211
1 mln rupiah 303.6/304.1
100 pesos 8.25/8.27
Gold down
The physical price of gold as at 9.30 am stood at RM278.48 per gramme, down 71 sen from RM279.19 at 5 pm yesterday. – BERNAMA
