Selangor Journal

Ringgit seen flat next week, to trade between RM4.23 and RM4.24 against US dollar

KUALA LUMPUR, Aug 14 — The ringgit is expected to trade between RM4.23 and RM4.24 against the US dollar next week due to lacklustre sentiment in the global oil market, said Bank Islam Malaysia Bhd economist Adam Mohamed Rahim.

He said market sentiments will continue to be affected in an already oversupplied oil market with US president Joe Biden urging the Organisation of Petroleum Exporting Countries (OPEC) and its allies to boost production quickly in an effort to tame climbing gasoline prices.

“On the demand side, OPEC left its forecast for oil demand growth in 2021 and 2022 unchanged while the International Energy Agency (IEA) cut oil demand for the second half of the year by 550,000 barrels a day due to the worsening progression of the pandemic,” he told Bernama.

As such, he said the lacklustre sentiment of the oil market would have an effect on the ringgit.

Malaysia’s better second quarter (Q2 2021) gross domestic product (GDP) performance, which expanded by 16.1 per cent (Q1 2021: -0.5 per cent), had little effect on the local note versus the greenback.

Bank Negara Malaysia (BNM) on Friday said the better Q2 2021 economic performance was mainly supported by the improvement in domestic demand and continued robust exports performance.

BNM Governor Datuk Nor Shamsiah Mohd Yunus said Malaysia’s economic growth for 2021 was now projected to be between 3 and 4 per cent, slower than the earlier projection of between 6 and 7 per cent, largely due to the re-imposition of the nationwide Covid-19 containment measures following the spike in infection rates.

For the week just ended, the local note was mostly lower throughout the week on worries over the higher daily Covid-19 cases.

On a weekly basis, the ringgit settled at 4.2365/2385 against the greenback from 4.2180/2205 a week ago. However, the ringgit was traded higher against other major currencies compared to a week earlier.

It appreciated against the Singapore dollar at 3.1187/1207 from 3.1219/1240 and rose against the British pound at 5.8476/8504 from 5.8685/8720, previously.

The local note advanced against the euro to 4.9775/9798 from 4.9815/9844 in the preceding week and strengthened vis-a-vis the Japanese yen at 3.8409/8427 from 3.8415/8442 previously.

— Bernama

 

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