KUALA LUMPUR: News on the overnight policy rate cut by the Bank Negara Malaysia, aimed at spurring Malaysia’s economic growth, somewhat lent support to the ringgit which opened higher on Thursday against the US dollar as more buying demand emerged for the local currency, dealers said.
At 9 am(0100gmt), the local unit was quoted at 3.9600/9650 against the greenback from 3.9690/9740 at 5pm on Wednesday.
Traders expect the local note to strenghten further to around 3.95.
Wednesday, BNM reduced the OPR by 25 basis points to 3.00 per cent, the first since 2009, to ensure the economy remained on a steady growth path.
Earlier this week, analysts predicted that the OPR would be left unchanged, however, the cut was welcomed by many Malaysians as this meant “more money in their hands”.
Meanwhile the ringgit today was traded mostly higher against a basket of major currencies, except against the Euro.
Versus the the Singapore dollar, the ringgit rose to 2.9403/9449 from 2.9446/9492 and against the yen it improved to 3.8015/8081 from 3.8039/8098.
Vis-a-vis the British pound, the ringgit rebounded higher to 5.1967/2049 from 5.2637/2715 but it eased against the Euro to 4.3940/4008 from 4.3889/3960 yesterday.