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KUALA LUMPUR: The ringgit opened stronger on Monday thanks to a weak US dollar and optimism about the 2021 budget announcement on Friday.
At 9:06 am, the local currency was at 4.1200 / 1290 against the dollar, compared to Friday’s close of 4.1275 / 1325.
Axi’s chief global market strategist Stephen Innes said that after being held back last week, the ringgit is now catching up with the yuan and North Asian currencies, which have soared.
“The 2021 budget should be well received, as it is expected to offer some tax breaks and provide additional support to the economic sectors where it is most needed,” he told Bernama.
Innes said that with Joe Biden being declared president of the United States, it is believed he could reduce the level of commercial fractions, especially in Asia.
“Assessing global geopolitical risk under the Biden presidency could be the most underrated advantage of all, as global supply chains could redistribute goods in a more globalized way.”
“Things could even return to the pre-pandemic level in the next 12-24 months if a vaccine proves to be the ultimate brake on the recession and a revolutionary panacea for global growth, and this will be a good thing for assets in Asia,” he noted.
Meanwhile, the ringgit traded mixed against other currencies.
It rose against the Singapore dollar to 3.0596 / 0667 from 3.0624 / 0668 at Friday’s close and improved against the yen to 3.9857 / 9948 from 3.9918 / 9978.
However, the ringgit was down against the euro at 4.8966 / 9086 from 4.8923 / 8995 and was down against the British pound at 5.4293 / 4428 from 5.4231 / 4313 previously. – Bernama
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