KUALA LUMPUR, May 24 (Bernama) - The ringgit opened lower against the US dollar as the greenback stayed firm, driven by a jump in US Treasury yield amid uncertainties surrounding the United States (US) debt ceiling talks, said an analyst.
At 9 am, the local note stood at 4.5790/5820 versus the greenback from Tuesday's closing rate of 4.5700/5750.
Bank Muamalat Malaysia Bhd chief economist and social finance head Dr Mohd Afzanizam Abdul Rashid said the US government debt ceiling negotiations continued to take the limelight as the politicians have yet to come to an agreement on raising the debt limit, failing which could result in a default in debt obligation.
"At 129 per cent of gross domestic product, the US government debt is sizeable and therefore any default could reverberate across the global markets.
"Despite that, the US dollar is still deemed as the safe haven currency and in times of uncertainties, market players would be inclined to seek protection by holding more dollars," he told Bernama.
He also noted that the US Dollar Index (DXY) has remained at an elevated level of 103.488 points.
As such, the ringgit is likely to remain weak, currently at 4.5725 against the US dollar with immediate resistant level located at 4.6257, he added.
Meanwhile, the ringgit was traded lower against a basket of major currencies.
It weakened vis-a-vis the British pound to 5.6894/6931 from 5.6577/6639 on Tuesday, depreciated against the euro to 4.9325/9357 from 4.9251/9305 and was lower against the Japanese yen at 3.3059/3083 from 3.3006/3044 yesterday.
The local note was also traded lower against other Asean currencies.
It eased versus the Indonesian rupiah at 307.7/308.1 from 307.1/307.7 on Tuesday's close and fell to 3.3994/4021 from 3.3920/3962 against the Singapore dollar yesterday.
The ringgit was marginally lower against the Philippine pesos to 8.21/8.22 against 8.20/8.21 from Tuesday's close and decreased vis-a-vis the Thai baht to 13.2341/2481 from 13.1712/1920 previously