KUALA LUMPUR (Sept 20): The ringgit rebounded to open marginally higher against the US dollar on Tuesday (Sept 20) on renewed buying interest, despite the anticipation of a US interest rate hike, a dealer said.
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At 9am, the local currency had risen to 4.5470/5510 against the greenback from 4.5495/5515 at Monday’s close.
However, ActivTrades trader Dyogenes Rodrigues Diniz said the US dollar is expected to continue to strengthen against the ringgit in anticipation of the interest rate decision in the US, where the Federal Open Market Committee is expected to announce a 75-basis-point (bps) hike.
Nevertheless, he said the market is already pricing in a hike of as much as 75 bps and if it happens, the US dollar is likely to lose some ground, at least initially.
“On the other hand, if the hike is 100 bps, it could bolster the US dollar further.
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“From a technical point of view, the US dollar/ringgit pair is in an extremely overbought region, which could signal buyer fatigue in the near future,” he told Bernama.
Meanwhile, the ringgit was traded lower against a basket of major currencies.
It fell against the pound to 5.1972/2018 from 5.1678/1700 at Monday’s close, and inched down versus the Singapore dollar to 3.2299/2332 from 3.2261/2278 previously.
The local note depreciated against the euro to 4.5620/5660 from 4.5372/5392 on Monday, and declined against the yen to 3.1757/1790 from 3.1706/1724 previously.-BERNAMA