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Ringgit to remain soft as greenback demand rises

KUALA LUMPUR: The ringgit retreated from the previous day’s gains to open lower against the greenback today on rising US bond yields after the latest US economic data strengthened the view that interest rates would stay higher for longer.

New home sales in the US rebounded 12.3% month-on-month to 759,000 units in September, which was higher than consensus estimates of 680,000 units. It was the highest level since February 2022.

Bank Muamalat Malaysia Bhd chief economist Afzanizam Rashid said following the latest batch of positive US economic data, benchmark US Treasury bonds continued their upward march towards the 5% level.

“On that note, the ringgit is likely to remain soft within the RM4.78 range today as market sentiments remain guarded, which favours the greenback’s outlook,” he told Bernama.

Market players are also waiting for the US third-quarter gross domestic product preliminary estimates later today to gauge the Federal Reserve’s next interest rate decision ahead of its meeting at the end of this month.

At 9am, the ringgit slid to 4.7850/4.7895 against the greenback from Wednesday’s close of 4.7780/4.7830.

In the early trade, the ringgit was mostly higher versus a basket of major currencies.

It gained versus the British pound to 5.7851/5.7905 from 5.7905/5.7965 at the close on Wednesday and edged up against the Japanese yen to 3.1858/3.1890 from 3.1866/3.1902 yesterday. However, it decreased against the euro to 5.0525/5.0572 from 5.0494/5.0547 previously.

The local note was traded mixed against other Asean currencies.

The ringgit was higher vis-a-vis the Singapore dollar at 3.4858/3.4896 from 3.4871/3.4910 and strengthened against the Thai baht to 13.1637/13.1804 from 13.1960/13.2153 previously.

In contrast, it decreased against the Indonesian rupiah to 301.4/301.9 from 301.0/301.5 at Wednesday’s close, and inched down versus the Philippine peso to 8.41/8.42 from 8.40/8.41 previously.