Kuala Lumpur (Dec 6) - The ringgit began Tuesday on a firmer note against the US dollar, rising modestly as investors weighed developments surrounding the United States and Venezuela, while earlier demand for the greenback faded amid relatively contained geopolitical concerns.
At 8am, the local currency strengthened to 4.0650/4.0745 versus the US dollar, compared with Monday’s closing level of 4.0695/4.0745.
Market sentiment improved as risk appetite stabilised, prompting capital flows to return to emerging market currencies and higher-yielding assets. Overnight, the US dollar initially gained support from geopolitical developments and signals from global central banks, but this momentum weakened later in the session. By late trading, the US dollar index slipped 0.17% to 98.26, leaving it only slightly higher for the year.
The ringgit’s performance was further supported by a recovery in the Asia Dollar Index, signalling renewed investor interest in emerging market currencies as risk tolerance improved.
However, the ringgit softened against major global currencies. It weakened versus the Japanese yen to 2.5958/2.6020, declined against the British pound to 5.5012/5.5140, and eased against the euro to 4.7626/4.7737.
Against regional currencies, the ringgit showed mixed movement. It strengthened slightly versus the Indonesian rupiah, Thai baht and Philippine peso, but slipped against the Singapore dollar.
For Sabahans, movements in the ringgit are especially significant as changes in currency strength can affect the cost of imported goods, travel expenses and business transactions, particularly for exporters, small traders and consumers in a state that relies heavily on inter-regional trade and imports.