Ringgit weakens versus US dollar amid economic uncertainties

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KUALA LUMPUR (Jan 3): The ringgit opened lower against the US dollar as the greenback remained firm as a safe haven currency amid external economic uncertainties.

At 9.00 am, the ringgit traded at 4.1460/1500 versus the US dollar from 4.1350/1390 at Wednesday's closing.

Bank Islam Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the manufacturing Purchasing Managers' Index (PMI) reported this week showed a weakening trend in manufacturers sentiment.

"The recent global PMI which slipped to 51.5 points in December,  suggests manufacturers are becoming increasingly wary over business prospects. It has prompted flight to quality assets, hence, making the US dollar attractive as a safe-haven asset," he told Bernama.

Similarly, he said, Malaysia’s PMI also declined to 46.8 points December and remained below the 50-point demarcation line for three consecutive months.

This means  production will be affected as businesses may want to keep their inventory low and by extension, capital expenditure and labour hiring, would be kept very minimal, he added.

At the opening bell, the ringgit traded mixed against other major currencies.

It fell against the Japanese yen to 3.8474/8522  from 3.7950/7997 on Wednesday and was lower against the Singapore dollar at 3.0327/0367 from 3.0331/0371.

The ringgit rose versus the pound to 5.2032/2099 from 5.2473/2540 and appreciated vis-a-vis the euro to 4.7028/7082 from 4.7275/7334 on Wednesday.