KUALA LUMPUR (Jan 16): The ringgit continued its positive momentum on Monday morning (Jan 16) to open slightly higher against the greenback, on expectations of a US Federal Reserve (Fed) downshift to a 25-basis-point interest rate hike.

At 9am, the ringgit stood at 4.3305/3350 against the greenback, from last Friday’s close at 4.3325/3375.

SPI Asset Management managing partner Stephen Innes told Bernama that the expected downshift in US interest rates in February and the China reopening factor had continued to drive sentiment.

He said the expected boost to commodity prices, particularly crude oil, as China's economy returns to full swing was also boosting appetite for the local currency.

“Traders will be eyeing a gaggle of Fed [data] this week for a confirmation of how the board views falling inflation.

“Moving from high and rising inflation to moderating inflation is good for risky assets, as it should dial down the Fed’s hawkish impulse,” Innes said.

The Fed pencilled in a terminal rate of 5.1% for 2023 in the last Federal Open Market Committee meeting.

Meanwhile, the ringgit traded mostly lower against a basket of major currencies, except against the euro, where it rose to 4.6960/7009 from 4.6986/7040 at last Friday’s close.

The local unit was lower against the Singapore dollar to 3.2839/2878 from 3.2782/2825, fell vis-a-vis the yen to 3.3882/3923 from 3.3703/3744, and was weaker against the pound, where it fell to 5.3040/3095 from 5.2973/3035 previously.