KUALA LUMPUR: The ringgit extended its decline against the US dollar at the close today amid greater optimism over businesses reopening across major economies as well as firmer West Texas Intermediate (WTI) oil prices.
The encouraging situation has led to the strengthening of major currencies, especially the greenback.
At 6 pm, the ringgit was quoted at 4.3660/3740 compared with last Friday’s close of 4.3480/3540.
On a weekly basis, the ringgit slid 0.9% on the back of global uncertainty due to the Covidf-19 pandemic as well as renewed trade tension between the United States and China.
An analyst said that despite weakening over the past week, the ringgit was unlikely to breach the 4.40 level against the greenback as the local economy had shown strong signs of a rebound.
“Malaysia has recorded better-than-expected gross domestic product (GDP) results for the first quarter despite contractions in almost all economic segments.
“Despite the lack of optimism on the GDP performance in the second quarter, I believe that contraction would be within the range of expectations as economic activities have resumed since early this month,” she said.
On the oil front, WTI crude rose above US$30 a barrel for the first time in two months as producers in the US and elsewhere continued to cut activity, which has led to the stronger dollar.
Benchmark Brent crude, meanwhile, continued to hover in the US$30-US$35 per barrel range. It was trading at US$33.85 at 6 pm.
Meanwhile, the ringgit also closed lower against a basket of major currencies.
The local currency slipped against the Singapore dollar to 3.0606/0667 from 3.0542/0591 on Friday and depreciated versus the Japanese yen to 4.0686/0768 from 4.0605/0673.
The Japanese yen has strengthened against the ringgit since the start of the Covid-19 pandemic as the yen is considered as a safe haven in the Asia region.
The ringgit also fell vis-a-vis the euro to 4.7179/7283 compared with 4.7011/7084 at last Friday’s close but it firmed slightly against the British pound to 5.2925/2039 from 5.3067/3154 previously. – May 18, 2020, Bernama
