Ringgit extends rally against US dollar, taking cue from Bursa Malaysia gains

KUALA LUMPUR: The ringgit extended its rally against the US dollar for the third consecutive day on the back of a spillover effect from foreign investors' interest in the local bourse, said an economist.

At 6 pm, the ringgit advanced to 4.3425/3460 against the greenback versus Tuesday's close of 4.3460/3500.

"We have seen foreign investors recording net purchases totalling RM1.2 billion from Aug 1 to Aug 27.

"This suggests foreign investors have shown strong interest in Malaysia's capital markets, effectively creating a higher demand for the ringgit," Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid told Bernama.

Bursa Malaysia extended its rally today, with the key index closing near a 45-month high at 1,675.24 from Tuesday's close of 1,652.29, fuelled by a surge in sentiment within the financial sector, underpinned by the robust quarterly earnings reports from key players.

Mohd Afzanizam expects the US dollar/ringgit pair to test its immediate support level of RM4.3000 in the near term in light of the possible cut in the US benchmark interest rates in September.

"Furthermore, the revision in the country's rating for Malaysia by the global investment banks would also lure more investors from abroad to acquire Malaysia's financial assets," he added.

The ringgit was mostly higher at the close against a basket of major currencies.

The local currency eased slightly against the Japanese yen to 3.0096/0122 from 3.0006/0035 on Tuesday but rose against the euro to 4.8362/8401 from 4.8532/8576 and gained against the British pound to 5.7425/7472 from 5.7511/7564 yesterday.

At the same time, the local note traded lower against ASEAN currencies.

The ringgit edged down against the Singapore dollar to 3.3337/3367 from Tuesday's 3.3331/3364 and fell against the Indonesian rupiah to 281.5/281.9 from 280.4/280.8.

It also fell vis-a-vis the Thai baht to 12.7709/7865 against 12.7523/7712 at yesterday's close and was unchanged against the Philippines' peso at 7.72/7.73.

-- BERNAMA

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