Ringgit opens higher on expectations of OPR normalisation

KUALA LUMPUR: The Malaysian ringgit opened higher against the US dollar on Thursday, driven by hopes of overnight policy rate (OPR) normalization during Bank Negara Malaysia's Monetary Policy Committee (MPC) meeting the following week. At 8am, the ringgit climbed to 4.0720/4.0800 against the US dollar, up from Wednesday's close of 4.0745/4.0790.

Bank Muamalat Malaysia Bhd chief economist Afzanizam Rashid attributed the stability to the decision to keep the OPR at 2.75%. Meanwhile, the US dollar index (DXY) dropped by 0.19% to 102.127 points, as Fed members maintained the benchmark interest rate between 3.75% and 4%. Rashid noted that the Fed's cautious approach to achieving price stability in a growing economy could bolster the ringgit.

Despite trading mostly lower against major currencies at the open, the ringgit showed gains against the Japanese yen, Japanese yen, British pound and euro. However, its performance was mixed against Asean currencies, with a slight increase against the Indonesian rupiah, flat against the Philippine peso, and a marginal decline against the Singapore dollar and Thai baht.