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Ringgit Surges Vs US$ After Fed Leaves Rates Unchanged

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KUALA LUMPUR: The ringgit opened higher against the US dollar early Thursday after the Federal Reserve (Fed) left the US interest rates unchanged at its two-day meeting that ended yesterday, a currency dealer said.

At 9.15 am, the local unit advanced against the greenback to 4.1140/1190 from 4.1350/1430 on Wednesday.

The dealer said firmer overnight crude oil prices and forecast by a prominent research firm were also supportive factors for the ringgit.

“Benchmark Brent crude futures and West Texas Intermediate (WTI) futures had climbed as much as three per cent after a third surprise weekly drop in US crude stockpiles. This boosted the demand outlook in the world’s largest oil consumer.

“Traders also took seriously HSBC Global Research’s reiteration of its forecast for the ringgit to trade at 3.95 against the US dollar by the end of this year and 3.85 by end-2017,” he added.

The degree of the ringgit’s undervaluation today is excessive, given its improved international investment position, HSBC was quoted as saying in a research note.

The ringgit was traded mixed against other major currencies in early trade today.

The local note continued its decline against the Singapore dollar to 3.0404/0461 from 3.0389/0459 on Wednesday, and weakened against the yen to 4.1029/1087 from 4.0711/0810.

It rose against the British pound to 5.3614/3683 from 5.3743/3871 and advanced against the euro to 4.6040/6100 from 4.6085/6190. – Bernama

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