Kuala lumpur: The ringgit jumped 135 basis points to rebound to the 3.96 level against the US dollar at the opening today, supported by improved global risk sentiment amid expectations of a potential second-round negotiation between the US and Iran. At 8 am, the ringgit appreciated to 3.9600/9715 against the US dollar from 3.9735/9805 at Monday's close.
According to BERNAMA News Agency, Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid indicated that recent developments in the global oil market, following the news that there will be another second-round negotiation between the US and Iran in the near term, have dragged West Texas Intermediate (WTI) and Brent crude oil prices to fall below US$100 per barrel. He noted that the news sparked hope for an amicable solution, although it can also be elusive.
On the US dollar, which is considered a safe-haven currency, Mohd Afzanizam observed that the two- and 10-year US Treasury yields fell by two basis points to 3.77 per cent and 4.29 per cent, respectively. Similarly, the US Dollar Index (DXY) declined 0.23 per cent to 98.425 points. He mentioned that there appears to be a risk-on mode, although that may be quite tentative given the evolving nature of the negotiations. Mohd Afzanizam suggested that the ringgit might rebound slightly but should remain in a narrow range of RM3.96 to RM3.98 today.
Despite trading firmer against the US dollar, the ringgit was mostly lower against a basket of major currencies at the opening, except against the Japanese yen. It fell against the British pound to 5.3515/3671 from 5.3360/3454 and weakened against the euro to 4.6589/6725 from 4.6434/6516. Against the Japanese yen, it rose to 2.4867/4940 from 2.4875/4920 at Monday's close.
The local currency also traded mostly higher against ASEAN currencies, except against the Thai baht. It increased versus the Singapore dollar to 3.1105/1205 from 3.1145/1205, was higher against the Indonesian rupiah to 231.5/232.3 from 232.2/232.8, and gained against the Philippine peso to 6.58/6.60 from 6.60/6.62 at Monday's close. However, the local note depreciated against the Thai baht to 12.3623/4071 from 12.3202/3503.