KUALA LUMPUR, Sept 25 — The ringgit is expected to trade higher next week as sentiment is likely to improve supported by the tabling of the much-awaited 12th Malaysia Plan 2021-2025 (12MP).
The 12PM will be tabled in the Parliament on Monday (September 27), covering welfare, income gap, social security and ongoing projects.
Minister in the Prime Minister’s Department (Economy) Datuk Seri Mustapa Mohamed the prolonged pandemic crisis has transformed the government’s spending pattern, which is now more focused on post-pandemic developments for the next five years.
In addition, a trader told Bernama the US Federal Reserve stance make investors bullish, adding that risk-on sentiment could weigh on the greenback.
Hence, he said the ringgit is likely to hover between the 4.15 and 4.19 levels next week.
The Fed has signaled a more dovish view on the rate outlook with many expecting a hike to begin sometime next year.
Despite no changes made to the existing pace of asset purchases of US$120 billion per month for now, tapering may conclude in mid-2022.
Worries over China’s Evergrande Group’s debt also seemed reducing given the liquidity injection by the monetary authorities.
The debt-ridden Evergrande has been weighing on investor sentiment for most of the week, benefitting the US dollar.
“Investors will continue to monitor the struggling property developer development,” the trader added.
During the week, the ringgit was mostly lower versus the greenback.
On a weekly basis, the ringgit weakened to 4.1865/1890 vis-a-vis the greenback on Friday from 4.1700/1730 a week ago.
The ringgit, however, was traded mostly higher compared to other major currencies a week earlier.
It improved slightly against the Singapore dollar at 3.0981/1004 from 3.0985/1010 a week before and rose against the British pound to 5.7359/7393 from 5.7483/7525.
The local note also was better against the euro to 4.9120/9150 from 4.9135/9170 but depreciated on the Japanese yen to 3.7925/7951 from 3.7913/7943 on the previous Friday. — Bernama