Market jitters to set tone for ringgit next week, with RM4.24-RM4.26 range expected
This follows the anticipation of a potential meeting between United States (US) President Donald Trump and Chinese leader Xi Jinping, as well as the upcoming Federal Open Market Committee (FOMC) meeting by the end of the month.
SPI Asset Management managing partner Stephen Innes said the market is expected to adopt a tone of cautious optimism next week, as the potential Trump-Xi meeting could reset the US-China dialogue, lifting broader Asian sentiment.
"For Malaysia, any thaw in trade tensions could brighten the macro outlook and, by extension, offer a floor to the ringgit in the near term. That diplomatic backdrop, however tentative, has helped curb more aggressive ringgit selling into the weekend,' he told Bernama.
Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said that the next FOMC meeting will be held on July 29 and 30, and therefore, market participants will be closely watching to see whether the US Federal Reserve (Fed) will cut the Fed Fund Rate.
"Next week, there are not many data points to look at other than some comments from the Fed officials; thus, the market will be adopting a wait-and-see stance,' he added.
Meanwhile, Kenanga Investment Bank Bhd said the ringgit remains supported by improving domestic
fundamentals, rising foreign direct investment inflows, and infrastructure catalysts such as the resumption of the Mass Rapid Transit 3 project.
"We expect US dollar-ringgit to range between RM4.23 to RM4.25 per US dollar in the near term,' it said in a note today.
On a Friday-to-Friday basis, the ringgit ended the week better against the greenback, closing at 4.2410/2455 as compared with 4.2475/2525 previously.
The local note also traded higher against a basket of major currencies.
The ringgit appreciated vis-à-vis the Japanese yen to 2.8517/8549 from 2.8893/8929, and strengthened against the British pound to 5.6999/7060 from 5.7524/7592 last Friday.
It also rose versus the euro to 4.9336/9388 from 4.9679/9737 at the end of last week.
Against ASEAN currencies, the ringgit traded mostly higher.
The local note firmed against the Singapore dollar to 3.3027/3065 from 3.3186/3228, strengthened versus the Indonesian rupiah to 260.2/260.6 from 261.8/262.3 previously, and improved against the Philippine peso to 7.41/7.43 from 7.52/7.53 last Friday.
However, it weakened versus the Thai baht to 13.3027/3065 from 13.0668/0886. - Bernama
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