KUALA LUMPUR: The Malaysian ringgit opened slightly higher against the US dollar on Monday, amidst a backdrop of cautious sentiment as traders reevaluated their positions regarding the US Federal Reserve's potential interest rate decisions.

At 8 am, the ringgit was priced at 4.2150/2240 against the US dollar, a minor improvement over Friday’s closing of 4.2155/2240. According to Dr. Mohd Afzanizam Abdul Rashid, the chief economist at Bank Muamalat Malaysia Bhd, this change can be attributed to the rising US Dollar Index (DXY), which increased to 102.572 points. Additionally, the yield on the two-year US Treasury note surged by 22 basis points to reach 3.92 percent.

Dr. Afzanizam noted that the recent economic indicators from the US suggest a strong economic performance, prompting traders to reconsider their views on the Fed's monetary policy. The latest employment data revealed that the nonfarm payroll (NFP) rose to 254,000 in September, significantly higher than August’s revised figure of 159,000, showcasing the resilience of the US labor market, with the unemployment rate dipping to 4.1 percent.

Despite this positive news for the US economy, he predicted that the ringgit might face challenges today, as the US dollar retains its strength.

In broader terms, the ringgit also appreciated against several major currencies.

It strengthened against the euro, trading at 4.6239/6337 compared to 4.6484/6578 last week. The local currency improved against the Japanese yen as well, showing a price of 2.8329/8391, up from 2.8779/8839. Similarly, it rose against the British pound, pricing at 5.5309/5427 from a previous 5.5505/5617.

Conversely, movements against ASEAN currencies were mixed. The ringgit increased against the Thai baht, reaching 12.6406/6797 compared to 12.7549/7861 previously. However, it weakened against the Singapore dollar, falling to 3.2301/2373 from 3.2489/2557 last Friday. The currency remained stable against the Indonesian rupiah, holding steady at 272.1/272.9 and showed no change against the Philippine peso at 7.49/7.51 from the last close of 7.48/7.50.

As traders eye future economic data and Fed announcements, the ringgit's path remains uncertain, navigating a complex landscape of domestic and international economic factors. Will the ongoing shifts compel traders to adjust their strategies further? Stay tuned for updates as the situation evolves!