Weak Oil Price Weighs On Ringgit Vs US Dollar

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The ringgit was lower against the US dollar in the early session on Monday on weaker demand for the local note as buying sentiment was hampered by declining global oil price.

At 9.45 am, the local unit was quoted at 4.3400/3520 against the greenback from 4.2950/2050 recorded last Thursday.

Bernama quoted a dealer as saying market sentiment towards the ringgit was affected as the oil price fell on worries that the global oil glut could persist as US-China trade tension was seen to hold back an economic recovery.

US West Texas Intermediate (WTI) crude futures declined 7.6 per cent to US$18.27 per barrel while Brent crude slid 3.4 per cent to US$25.54 per barrel.

Meanwhile, the ringgit was traded lower against other major currencies.

It depreciated against the Singapore dollar to 3.0596/0691 from 3.0461/0543, weakened against the yen to 4.0652/0772 from 4.0253/0358.

It fell against the pound to 5.4076/4235 from 5.3675/3808 and was lower against the euro at 4.7527/7672 from 4.6639/6765, according to Bernama.

Meanwhile, Reuters reported that in commodity markets, U.S. crude futures sank in early trade on worries about oil oversupply, even as some U.S. states and cities around the world start to ease coronavirus pandemic restrictions.

West Texas Intermediate crude futures last sat at $18.59 per barrel, down $1.19, while Brent futures were down 2.4%, or 64 cents, at $25.80.

US manufacturing plunged to an 11-year low last month, consumer spending has collapsed and some 30.3 million Americans have filed claims for unemployment in the last six weeks.

“There is a sense of caution, if not foreboding as signs of economic weakness continue to emanate,” said Vishnu Varathan, head of economics and strategy at Mizuho Bank in Singapore, Reuters reported.

Source TheStar

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