KUALA LUMPUR, March 2 ― The ringgit is expected to remain range-bound in the first full week of March, trading at the 4.06-4.08 levels against the US dollar, said FXTM research analyst Lukman Otunuga.
He said investors would be looking out for January’s external trade data on March 4 and before Bank Negara Malaysia make its next monetary policy decision on March 5.
“Given that domestic inflation is likely to remain manageable in 2019, along with the resilience in economic growth and domestic consumption, Malaysia’s central bank is expected to stand pat on the Overnight Policy Rate this year,” he told Bernama.
Lukman said Malaysia’s January exports and import figures will be closely watched, set against the backdrop of plateauing global growth.
“China’s February manufacturing PMI fell further into contractionary territory, which points to moderating growth in the world’s second largest economy.
“Hence, small and open economies like Malaysia may feel the effects of China’s slowdown via the trade channel,” he added.
He said, however, another outsized positive surprise for Malaysia’s export figures, as was the case with December’s print, may serve to boost the ringgit in the near-term.
“The significant positive developments in US-China trade negotiations also may send the ringgit below the 4.06 level,” he added.
For the week just ended, the ringgit closed lower in tandem with most Asian emerging currencies, as many investors stayed on the sidelines due to uncertainty over the US-China trade negotiations.
The steady US dollar against major rivals yesterday was supported by rising US Treasury yields after data showed that the US economy grew 2.6 per cent in the fourth quarter.
On a Friday-to-Friday basis, the ringgit was higher at 4.0720/0770 against the US dollar from 4.0760/0810 in the previous week.
It also appreciated against the Japanese yen to 3.6383/6438 from 3.6770/6825 and rose against the Singapore dollar to 3.0105/0146 from 3.0119/0165 last Friday.
However, the local unit weakened against the euro to 4.6258/6319 from 4.6214/6287 and fell, vis-a-vis the British pound, to 5.3921/3000 from 5.3065/3135. ― Bernama
