The ringgit opened slightly higher against the US dollar this morning amid cautious market sentiment on the potential for gradual US tariff hikes and the release of the US Producer Price Index (PPI) and US Consumer Price Index (CPI) due this week.
At 10.15am, the ringgit was at 4.5000, recovering 0.18% against the US dollar from its close of 4.5080 at the end of Monday.
Bank Muamalat Malaysia Bhd Chief Economist Mohd Afzanizam Abdul Rashid said the US Dollar Index remained high at 109.956 points after hitting 110.163 last night, the highest since November 2022 when the US Federal Reserve (Fed) raised policy rates to curb inflation.
US President Donald Trump's chosen economic team is reportedly considering gradual tariff hikes of 2 per cent to 5 per cent per month under the International Emergency Economic Powers Act.
This approach is aimed at increasing negotiating leverage while minimising inflation risks.
He added that the sentiment would keep the ringgit in a tight range of around RM4.50 to RM4.51.
Afzanizam also pointed out that CPI is expected to be higher at 2.9% in December compared to 2.7% the previous month.
Meanwhile, the ringgit opened mostly lower against major currencies.
It strengthened against the Japanese yen to 2.8555/8636 from yesterday's close of 2.8706/8733, but it fell against the euro to 4.6107/6235 from 4.5964/6004 and weakened against the British pound to 5.4943/5096 from Monday's close of 5.4592/4640.
The local note was traded mixed against Asean currencies.
The ringgit rose against the Philippine peso to 7.65/7.68 from 7.68/7.69 and was higher against the Indonesian rupiah at 275.8/276.8 from 276.8/277.2 recorded at yesterday's close.
It depreciated against the Thai baht to 12.9486/9947 from 12.9440/9618 and fell against the Singapore dollar to 3.2830/2926 from 3.2788/2822 at yesterday's close.
