Ringgit opens slightly higher against US dollar ahead of GDP announcement

At 9am, the local note stood at 4.3900/3950 versus the greenback from yesterday's close of 4.3935/3945. — Picture by Hari Anggara
At 9am, the local note stood at 4.3900/3950 versus the greenback from yesterday’s close of 4.3935/3945. — Picture by Hari Anggara

KUALA LUMPUR, May 13 ― The ringgit opened slightly higher against the US dollar today, ahead of the first quarter (Q1) gross domestic product (GDP) announcement by Bank Negara Malaysia (BNM) later today, an analyst said.

At 9am, the local note stood at 4.3900/3950 versus the greenback from yesterday’s close of 4.3935/3945.

SPI Asset Management managing partner Stephen Innes said there is a wide breadth of expectations among economists who expect the GDP to rise between 4.0 and 5.0 per cent.

“I think anything within that band would be neutral for the ringgit but below could be negative and above could be positive. It’s a wait and see on that call,” he told Bernama.

Moody’s Analytics projects that Malaysia’s economy has grown 1.1 per cent quarter-on-quarter in Q1 2022 following a 6.6 per cent expansion in fourth quarter (Q4) of 2021.

Meanwhile, OCBC Bank, had on February 11, revised upward its projection on Malaysia’s economic growth to 5.4 per cent in 2022 from its earlier estimate of 5.0 per cent on the back of improving private consumption in the fourth quarter of 2021 (Q4 2021), and the still-supportive exports environment.

For 2022, the bank estimates that the GDP would grow between 5.5 per cent and 6.5 per cent, backed by continued expansion in global demand and higher private-sector expenditure.

In Q4 2021, Malaysia’s economy expanded 3.6 per cent, bringing the full year growth to 3.1 per cent compared to a decline of 5.6 per cent in 2020

The central bank is expected to announce Q1 2022 GDP at 11 am.

The ringgit was traded mostly higher against a basket of major currencies.

It appreciated against the Singapore dollar to 3.1447/1487 from 3.1488/1500 on Thursday, increased vis-a-vis the euro to 4.5564/5616 from 4.5820/5830, and strengthened versus the Japanese yen to 3.4079/4120 from 3.4145/4156.

However, the local unit eased against the British pound to 5.3584/3645 from 5.3539/3551 previously. ― Bernama