Selangor Journal

Ringgit likely to trade higher versus US dollar next week

The ringgit is expected to trade higher versus the US dollar next week, and hover around the 4.2-level, supported by buying from foreign and local investors following an improvement in the global economy, as well as positive economic development in the country.
Affin Hwang Investment Bank Vice-President and Head of Retail Research Datuk Dr Nazri Khan Adam Khan said the local unit was slowly picking up momentum and economists expect this trend to continue.
Nazri Khan told Bernama news that two local banks, RHB Bank Bhd and AMMB Holdings Bhd have proposed to merge, will boost confidence among investors and welcome more foreign funds into the country.
The two banks have received the nod from Bank Negara Malaysia (BNM) to commence merger negotiations.
Separately, Minister in the Prime Minister’s Department Datuk Seri Abdul Rahman Dahlan said BNM’s measures to clamp down on currency speculators, who had been using the offshore market non-deliverable forwards to speculate on the ringgit, has paid off with the currency improving and foreign portfolio investors coming back.
“Many research houses, investment banks and fund managers such as BNP Paribas Investment Partners, Deutsche Bank, Western Asset Management and Fidelity International viewed Malaysia with optimism.
“Foreign portfolio investors have returned since April this year, of which 10% of the money has come back into the Malaysian government and central bank bonds.
“Collective in their opinion, the research houses, investment banks and fund managers are of the view that Malaysia is on the right track where the worst of foreign outflows is behind us,” he said, adding, the ringgit had shown continuous improvement this year and was the best performing currency, regionally, in April 2017.
For the week just-ended, the ringgit moved between 4.2705 and 4.860 against the US dollar.
On a Friday-to-Friday basis, the ringgit traded higher at 4.2790/2820 against the greenback from 4.3440/3470 last week.
The local note ended mostly lower against other major currencies for the week.
It fell against the Singapore dollar to 3.0873/0901 from 3.0844/0886 last Friday, but improved versus the Japanese yen to 3.8380/8417 from 3.8452/8496 previously.
The ringgit depreciated against the British pound to 5.5062/5105 from 5.4912/4955 and weakened vis-a-vis the euro to 4.8015/8053 from 4.7859/7897.

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