KUALA LUMPUR: The ringgit closed higher against the US dollar today as risk sentiment improved on oil trading throughout the day’s session, said an analyst.
At 6 pm, the local unit was traded at 4.3650/3750 versus the greenback compared with 4.3880/3950 at the close on Tuesday.
AxiCorp global chief market strategist Stephen Innes said oil prices were higher on hopes of Organisation of the Petroleum Exporting Countries’ (OPEC) intervention and this had weakened the demand for US dollar against oil-sensitive currencies, thus benefiting the ringgit.
He said the turnaround followed reports that OPEC+ may take further measures to support oil – possibly involving an expanded OPEC++ – at least enough to stem the tide while demand stabilises and recovers.
“The market is very fickle right now trying to figure out this oil market, but I think the worst is over and oil prices are starting to stabilise as open interest is dropping in the US crude oil futures benchmark West Texas Intermediate (WTI) June contract, where this will reduce delivery risk.
“Besides, risk sentiment continues to run positive as China plans to offer up more stimulus,” he added.
Meanwhile, the ringgit also traded higher against other major currencies.
It appreciated against the yen to 4.0525/0626 from 4.0841/0918 on Tuesday and strengthened against the Singapore dollar to 3.0582/0659 from 3.0676/0734.
The local note rose against the pound to 5.3964/4106 from 5.4122/4226 yesterday and improved vis-a-vis the euro, the local note improved to 4.7400/7517 from 4.7526/7620 on Tuesday. – April 22, 2020, Bernama
