Selangor Journal
Photo for illustration purposes only. — Picture by REUTERS

Ringgit likely to trade in tight range against US dollar next week

KUALA LUMPUR, Aug 6 — The ringgit is expected to trade in a tight range against the US dollar next week as investors continue to monitor various global economic data to chart the market direction, said an analyst.

SPI Asset Management managing partner Stephen Innes said the US House of Representatives Speaker Nancy Pelosi’s recent visit to Taiwan had jittered the market amid concerns over escalating US-Sino tension.

“However, investors seemed to shift attention away from the geopolitical event. Even if the Taiwan fracas passes, concerns about China’s domestic economy are overshadowing the positive risk sentiment.

“In addition, China continues to politicise COVID-19 controls, which should last until late this year and bring more damage to the domestic economy, and this should keep the ringgit grounded next week,” he told Bernama.

Moving forward, he said with the United States Non-Farm Payroll data released on Friday not expected to rock currency markets, traders will remain laser-focused on next week’s US Consumer Price Index (CPI) print which will unquestionably provide the main catalysts for the currency market.

“If the CPI print comes in lower than expected and confirms peak US inflation, the US dollar will sell off, and the ringgit should strengthen a bit.

“Looking at the current sentiment, Innes said the ringgit is likely to be defensive, trading in cautious mode, within the 4.4450 to 4.4560 range against the US dollar next week,” he said.

For the week just ended, the ringgit was traded mostly lower against the US dollar, except for Friday, as the geopolitical event in Taiwan and hawkish Federal Reserve officials’ statement continued to dominate the market sentiment, lifting the appeal of the greenback as a safe-haven asset.

On Friday, the ringgit strengthened against the greenback to 4.4490/4520 compared with 4.4495/4520 a week earlier.

The local note, however, traded lower against a basket of major currencies, except versus the British pound, on a Friday-to-Friday basis.

It depreciated against the Singapore dollar at 3.2330/2355 from 3.2243/2266 last week and eased against the Japanese yen to 3.3459/3484 from 3.3347/3368 previously.

The local unit went down versus the euro to 4.5513/5544 from 4.5385/5410 a week earlier but improved against the British pound to 5.3989/4025 from 5.4048/4078.

— Bernama

 

Top Picks

DOSM expects 50 pct registration rate ahead of Padu deadline

Five acquitted, discharged of murder of elderly woman in Sabak Bernam

Singapore land checkpoints record highest number of travellers on March 28