Ringgit opens slightly higher against US dollar

The ringgit opened higher against the US dollar today at 4.4200 as compared to Friday’s closing at 4.4360, boosted by the data of Non-farm Payroll (NFP) in the United States which was announced last Friday.

The NFP data showed moderate growth of payroll in the sector, putting investors in doubt about future monetary stance by The Fed this March.

In the NFP report, despite the US adding 227,000 jobs, higher than the expected 175,000, wages growth recorded a slower pace along with lower inflation pressure -- two crucial factors needed by The Fed to determine the next interest rate hike.

“All these factors along with plans by President Donald Trump in taking protectionist policies before pushing ahead with its stimulus promises which the financial markets purchased heavily into, you can understand why traders are behaving undecidedly to the NFP,” said FXTM Market Research Vice President, Jameel Ahmad in a statement.

Meanwhile, in the same session, the local unit traded lower against major currencies including Euro and Yen, while for this week, ringgit is expected to hover around 4.4000 and 4.3500 against the greenback.

According to Vice President/Head of Retail Research Affin Hwang Investment Bank Datuk Dr Nazri Khan, dollar has depreciated from the level of seven week high due to the sentiment that the US economy would be slower than anticipated.

“Dollar depreciation was contributed by this perception that the US economy is not strong enough to support The Fed’s next move to increase interest rate.

“The statement made by The Fed last week after its first 2017 meeting triggered some doubts about its plan in increasing the rate in March meeting,’ he said.

In the local market, the recovery of crude oil and commodity prices continue to support the ringgit performance.

Meanwhile, Bursa Malaysia opened slightly higher on Monday trading boosted by buying momentum especially in selected heavyweights.

At 9.06am, FTSE Bursa Malaysia FBM KLCI was traded at 1,685,64, 0.63 points higher compared to last Friday.

Along this week, local bourse is expected to be traded strong as the investors start to come into the market post Chinese New Year holiday.

According to Dr Nazri, Local bourse will test psychology level of 1700 points this week.