The ringgit rose slightly against the US dollar in early trading on Wednesday despite steady demand in support of the US currency.
At 9am this morning, the ringgit was at 4.7050 against the USD from yesterday's close at 4.7055.
Bank Muamalat Bhd's Chief Economist, Mohd Afzanizam said the US Dollar Index is still holding up as a sign that demand is still resilient amid expectations of lower interest rates.
Recently, Fed President Jerome Powell's statement to the US Congress suggested that the Fed is on track to cut rates if economic data warrants an immediate response.
He also said that rate cuts that are too little and too late can put the economy at risk temporarily. Powell also acknowledged that inflation is not the only problem facing the Fed.
In the local market, investors will monitor Bank Negara Malaysia's (BNM) Monetary Policy Committee meeting for their decision on the overnight policy rate (OPR) on Thursday.
The market predicts BNM to keep rates unchanged at 3.00% and the Fed to cut rates in September.
Meanwhile, the ringgit is trading higher than other major currency groups.
It added value against the Japanese yen to 2.9140 from Tuesday's close of 2.9219, rose higher to 6.0158 against the British pound from 6.0273 and rose against the euro to 5.0870/0935 from 5.0923/0977.
It also traded mostly higher than its Asean peers.
The ringgit rose against the Singapore dollar to 3.4829/4876 from 3.4848/4887 yesterday and rose to 12.9187/9402 against the Thai baht from 12.9268/9456 previously.
The local currency was unchanged against the Indonesian rupiah at 289.4/290.0 and slightly higher against the Philippine peso at 8.04/8.06 compared to 8.05/8.06 previously.
