The local currency began the day at 4.3305/4.3350 against the greenback, up from last Friday’s close of 4.3325/4.3375.

An expected downward shift in US interest rates in February, coupled with China’s reopening, have been driving investor sentiments, according to SPI Asset Management managing partner Stephen Innes.

Analysts said a drop to 25 basis points (bps) in US interest rate hike is likely. The market had earlier expected a 50bps rise next month.

Innes told Bernama the expected boost in commodity prices, particularly crude oil, as China’s economy returns to full swing is also swelling appetite for the local currency.

“Traders will be eyeing a gaggle of Fed (data) this week for confirmation on how the board views falling inflation,” he said.

“Moving from high and rising inflation to moderating inflation is good for risky assets as it should dial down the Fed’s hawkish impulse,” he added.

The Fed penciled in a terminal rate of 5.1% for 2023 at the last federal open market committee (FOMC) meeting.

Meanwhile, the ringgit traded mostly lower against a basket of major currencies, except against the euro, where it rose to 4.6960/4.7009 from 4.6986/4.7040 at last Friday’s close.

The local unit was lower against the Singapore dollar to 3.2839/3.2878 from 3.2782/3.2825, fell vis-a-vis the Japanese yen to 3.3882/3.3923 from 3.3703/3.3744 and against the British pound, where it fell to 5.3040/5.3095 from 5.2973/5.3035 previously.