KUALA LUMPUR: The ringgit is likely to continue the positive momentum against the US dollar next week as uncertainty over the safe haven currencies, including the greenback, has shifted investors interest towards emerging currencies, including the ringgit.
Affin Hwang Investment Bank Vice-President/Head of Retail Research Datuk Nazri Khan Adam Khan said the ringgit hovered around a one-month high against the US dollar this week following Bank Negara Malaysia’s decision not to raise interest rates.
He said the greenback also suffered from US Federal Reserve Chair Janet Yallen’s congressional testimony earlier this week which was deemed below expectations.
“We are encouraged that Bank Negara has decided to maintain OPR at 3.00 percent. With the announcement, BNM has left OPR unchanged for 15 consecutive months, lending support to the economy and broad market sentiment.
“Further, Bank Negara sees increasing upside to the domestic economy, particularly as global growth appears to be more synchronous, driven by higher industrial activity and global trade,” he told Bernama.
For the week just-ended, the ringgit moved between 4.2860 and 4.2960 against the US dollar, mainly influenced by Yallen’s congressional testimony on Wednesday which did not sound as hawkish as many had anticipated.
The local unit’s performance was also supported by Malaysia’s positive economic data released last Friday, which saw trade grew 31.5 percent to RM153.3 billion in May 2017, up from the RM116.6 billion in the corresponding month a year ago.
On a Friday-to-Friday basis, the ringgit traded higher at 4.2910/2940 against the greenback from 4.2970/3000 last week.
However, the local note traded mostly lower against other major currencies, except the euro.
It depreciated versus the Singapore dollar to 3.1210/1243 from 3.1088/1123 last week, weakened against the Japanese yen to 3.7886/7926 from 3.7799/7829 and went down against the British pound to 5.5624/5667 from 5.5466/5522.
The ringgit, however, appreciated against the euro to 4.8977/9016 from 4.9046/9085. –Bernama