Kuala lumpur: The ringgit showed an upward trend against most major currencies in early trading on Friday, though it experienced a slight decline against the US dollar as investors grew wary of rising tensions between the United States and Iran, according to an economist.
According to BERNAMA News Agency, at 8 am, the ringgit marginally weakened to 4.0430/0500 against the US dollar, compared to Thursday's closing rate of 4.0425/0470. Bank Muamalat Malaysia Bhd's chief economist, Dr Mohd Afzanizam Abdul Rashid, attributed the fluctuation to the US government's intentions to economically isolate Iran, anticipating that such measures would be announced soon.
Mohd Afzanizam noted that this geopolitical development has resulted in a 1.75% rise in Brent crude prices, reaching US$93.22 per barrel. Concurrently, the US is expanding its strategy to repurchase US Treasuries, a move aimed at keeping Treasury yields in check. The 30-year US Treasury yield increased by six basis points, standing at 5.25%.
He highlighted concerns regarding the potential economic isolation of Iran by the US and the implications it might have on trade partners engaged with Iran. Consequently, he forecasted that the ringgit would likely trade between RM4.04 and RM4.06 against the US dollar throughout the day.
At the market opening, the ringgit appreciated against a selection of major currencies. It gained ground against the Japanese yen, moving to 2.5445/5491 from 2.5527/5557 at the previous close, and strengthened against the British pound, trading at 5.5159/5254 from 5.5164/5225. Additionally, it edged upward against the euro, reaching 4.7251/7332 from 4.7322/7374 previously.
In dealings with regional currencies, the ringgit exhibited a mixed performance. It rose against the Singapore dollar, trading at 3.1797/1855 from 3.1813/1851 on Thursday, but fell against the Thai baht, moving to 12.3120/3400 from 12.3014/3211. The ringgit remained relatively stable against the Indonesian rupiah at 227.8/228.2 versus 227.7/228.1 previously, and showed little change against the Philippine peso, trading at 6.56/6.57 compared with 6.55/6.57.