KUALA LUMPUR, Jan 18 — The ringgit is expected to continue its upward momentum against the US dollar next week along with other emerging currencies, supported by bullish global economic outlook, dealers said.
FXTM market analyst Han Tan said the latest slew of economic data suggested that the global economy was stabilising and poised for a recovery amid de-escalating US-China trade tensions.
“Such an environment should also offer emerging markets the chance to find a more stable footing and provide room for riskier assets to advance higher.
“Although downside risks such as geopolitical conflicts could rear their head at any time, investors should be able to move forward with cautious optimism knowing that major risks have considerably subsided for the time being,” he said in a statement.
Tan said a steady global economy should also offer a solid platform for equities to climb further, with the ongoing US earnings season serving as the catalyst for further gains.
“Even with the S&P 500 and the MSCI World Index already at record highs, stock bulls are still expected to hold court over the coming weeks, despite US equities having ventured into overbought and overvalued territory.
“Investors expect Corporate America to report its first earnings growth since the end of 2018, with yesterday’s (Thursday’s) new leg up in US stocks boosted by Morgan Stanley’s record annual earnings,” he added.
For the week just ended, he said, most of Asian stocks and currencies were mixed, despite global investors being given positive signals on the world’s two largest economies.
“US retail sales climbed 0.3 per cent in December while jobless claims came in lower than expected at 204,000.
“China’s economy grew 6.1 per cent in 2019, meeting the official target range for the year, while its December industrial production and retail sales figures topped estimates, confirming the picture of an economy that has bottomed,” he said.
For the week just ended, the ringgit ended higher against the US dollar at 4.0520/0560 compared with last Friday’s 4.0750/0780.
Vis-a-vis other major currencies, the ringgit ended higher against the Singapore dollar at 3.0108/0149 compared with 3.0194/0219 last week, improved versus the British pound to 5.2895/2963 from 5.3244/3299 and strengthened against the euro to 4.5083/5139 from 4.5216/5254 last week.
Meanwhile, the local unit appreciated against the Japanese yen to 3.6776/6816 from 3.7160/7198 last Friday. — Bernama
