Baku:The ringgit opened slightly higher against the US dollar, benefiting from a weaker US Dollar Index (DXY) as investors reconsidered the outlook for US interest rates. This followed indications that the Federal Reserve might adopt a less aggressive monetary policy approach.

According to BERNAMA News Agency, at 8 am, the ringgit was at 4.0830/0880 against the greenback, up from Tuesday's close of 4.0835/0880. Dr. Mohd Afzanizam Abdul Rashid, chief economist at Bank Muamalat Malaysia Bhd, noted that the DXY decreased by 0.40 percent to 102.810 points after John Williams, President of the US Federal Reserve Bank of New York, suggested that the Fed Funds Rate might not increase in 2027 due to an expected gradual easing of inflation towards the two percent target.

Williams also indicated that the US economy is not overheating, which does not justify a significant rate increase. Mohd Afzanizam mentioned that US inflation figures, projected to rise to 3.6 percent in September from 3.4 percent previously, would be closely monitored, potentially benefiting the ringgit even though market sentiment remains cautious.

He added that the ringgit-US dollar exchange rate could maintain a narrow trading range of RM4.07 to RM4.09. At the market opening, the ringgit showed mixed performance against a range of major currencies. It rose against the Japanese yen to 2.5790/5823 from 2.5833/5864 at Tuesday's close but declined against the British pound to 5.4128/4195 from 5.4057/4177 and eased against the euro to 4.5734/5790 from 4.5654/5704.

In relation to its ASEAN counterparts, the ringgit traded mixed. It advanced against the Thai baht to 12.1626/1848 from 12.1663/1844 but was slightly lower against the Singapore dollar at 3.1903/1950 from 3.1902/1940 the previous day. The ringgit remained unchanged against the Indonesian rupiah at 228.1/228.4 and was flat against the Philippine peso at 6.50/6.51.