KUALA LUMPUR, Nov 16 — The ringgit is expected to trade rangebound next week, moving within the range of 4.14 and 4.16 against the US dollar as the US-China trade talks continue to dominate market sentiment.
AxiTrade chief Asia market strategist Stephen Innes said he expects the ringgit sentiment to improve but this would depend on developments of the trade talks.
“I still feel a little optimistic going (into) next week following an optimistic trade talks tone after White House economic adviser Larry Kudlow said a phase one deal is almost close.
“However, we still need to hear from US President Donald Trump about a possible tariff rollback,” he told Bernama.
Meanwhile, FXTM market analyst Han Tan said for the week ahead, a break above 4.16 against US dollar should bring 4.19 into focus, while a break below 200-day moving average of 4.14 could carve a path back towards 4.12 level.
“The ringgit will remain primarily influenced by extraneous factors, with the US-China trade deal still in the driver’s seat over global risk sentiment,” he said, adding that risk appetite remains sensitive to any developments on that front.
“Investors’ patience will be tested as they await news of the timing and location for the US-China trade deal’s signing, with such key details potentially triggering further gains for Asian currencies,” he added.
In addition, the minutes from the October Federal Open Market Committee meeting will be in focus, as investors try to ascertain the conditions that could prompt the Fed to adjust its policy settings again.
Locally, Malaysia’s October Consumer Price Index, to be released next Wednesday, is expected to have cooled to one per cent in October, slower than September’s 1.1 percent and August’s 1.5 percent.
“With Bank Negara Malaysia expecting inflation to average higher but remain modest in 2020, this suggests that the central bank may be less pressured by onshore factors to adjust its policy settings, while remaining vigilant over external headwinds,” Tan added.
The ringgit ended the week higher against the greenback at 4.1515/1545 as investors reacted positively to the third-quarter (Q3) gross domestic product (GDP) growth, which came within market expectations.
On a Friday-to-Friday basis, the local note was weaker compared to last Friday’s 4.1310/1360.
The local unit was also lower against the Singapore dollar at 3.0468/0501 from 3.0377/0418 and vis-a-vis the yen to 3.8186/8217 from 3.7774/7830.
The ringgit depreciated versus the euro to 4.5725/5762 from 4.5594/5666 and went down against the pound to 5.3430/3473 from 5.2906/2986. — Bernama