Ringgit to trade at current levels next week

The ringgit ended the week unchanged at 4.1840/1870 against the greenback. — AFP pic
The ringgit ended the week unchanged at 4.1840/1870 against the greenback. — AFP pic

KUALA LUMPUR, Oct 12 — The ringgit is expected to trade at the current levels next week, amid mixed market sentiment, mostly influenced by external developments, particularly the US-China trade negotiations and Brexit, said a dealer.

FXTM market analyst Han Tan said should negotiators walk away from the US-China trade talks empty-handed, leaving the existing tariff threats in place, it could send the local note towards the 4.20 level against the US dollar, as risk aversion also takes hold of the market.

“The outcome of the US-China trade talks in Washington is expected to have a major say in the performances of Asian currencies at the onset of next week.

“A limited trade deal or a truce, which remains inconclusive at the time of writing, is expected to restore risk appetite, with the ensuing US dollar weakness allowing the ringgit to carve a path towards the 4.16-mark,” he told Bernama.

He said throughout the week, the ringgit stayed within the 4.18-4.20 range, as Asian markets were whipsawed by trade-related noise leading up to the US-China negotiations.

“The local note gained during the tabling of the 2020 Budget which coincided with a weakening US dollar index, and restates the influence external factors have on the ringgit’s performance,” Tan added.

The policy measures announced in the 2020 Budget are set to ensure Malaysia’s economic fundamentals remain on a sound footing, with faster growth of 4.8 per cent forecast for next year.

“Keeping the fiscal consolidation agenda intact, even as the Malaysian economy weathers external headwinds, will be seen as a prudent move that should bode well for investor sentiment,” Tan explained.

The ringgit ended the week unchanged at 4.1840/1870 against the greenback.

The local currency, however, traded mostly lower against other major currencies.

It slid against the Singapore dollar to 3.0438/0471 from 3.0332/0363, declined versus the euro to 4.6103/6153 from 4.5928/5977, and fell against the pound to 5.2292/2346 from 5.1631/1680.

Vis-a-vis the yen, the local unit rose to 3.8691/8729 from 3.9194/9230 previously.  — Bernama

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