Ringgit Edges Up Ahead of Key US Economic Data Amid Easing Tensions

The ringgit opened higher against the US dollar on Monday ahead of key US economic data releases. The local currency edged up to 4.0805/0900 against the greenback from last Friday's close of 4.0835/0875.

Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said that the US Institute for Supply Management (ISM) Manufacturing PMI for July will be released tonight, with a consensus estimate at 54.0, higher than June's reading of 53.3.

Uncertainties over the Middle East conflict also weighed on market sentiment, with Brent crude oil rising 4.59 per cent to US$88.10 per barrel. President Donald Trump reportedly said that he has cancelled the planned military strikes against Iran as both countries are expected to reach a deal on the nuclear programme and the full reopening of the Strait of Hormuz.

Stephen Innes, managing partner at SPI Asset Management, said that the US dollar weakened after Trump cancelled the planned strike on Iran over the weekend. He added that the decision has sent oil prices and inflation breakevens lower, pulling down the US interest-rate curve.