KUALA LUMPUR, June 12 (Bernama): The ringgit is likely to trade in a range of 4.09 to 4.11 level this week as Malaysia aims to achieve the target of injecting 150, 000 doses of vaccine daily, said an analyst.
Bank Islam Malaysia Bhd economist Adam Mohamed Rahim, citing the latest data from the Covid-19 Vaccine Supply Access Guarantee Special Committee (JKJAV), said Malaysia administered over 150, 000 doses of vaccine since June 8.
"The sustainability of such vaccination trends is crucial to ensure that the country is approaching herd immunity.
"A faster journey to herd immunity will translate into the reopening of business activities on a larger scale, ” he told Bernama.
Meanwhile, Adam said the news that Saudi Arabia has unwound all its voluntary production cuts which could drag oil prices lower will limit any gains in the ringgit.
At the time of writing, Brent crude increased 0.23 per cent to US$72.69 per barrel.
On Friday, the ringgit strengthened to the 4.10 level against the US dollar after US inflation data was enough to convince investors that the rise in prices may be temporary.
US inflation surged to the highest rate since 2008 amid the Covid-19 pandemic.
The four-week average US unemployment claims data was revised up to 405, 000 from 385, 000, while this week's unemployment claims, at 376, 000, exceeded expectations by being above 370, 000.
ActivTrades trader Dyogenes Rodrigues Diniz said looking at the numbers as a whole, it's clear that inflation is rising somewhat but not as much as some had feared and that is the main reason why the dollar has failed to gain more ground against the local unit.
Next Wednesday, Diniz said investors should pay attention to the retail sales data. A higher than expected number should be bullish for the greenback.
"But the main macroeconomic event is due on Thursday, when all ears will be turned to the Federal Open Market Committee (FOMC) meeting, which should give us clues on the Fed's next monetary policy moves, ” he said.
Also on Thursday will be the interest rate decision. Although rates are unlikely to change, the wording used by the FOMC report is likely to examined very carefully and could cause a spike in volatility, he said.
If the FOMC doesn't show much concern about inflation in its report, the US dollar will likely continue to lose ground against the ringgit and it could reach the 4.0950 level in a few days.
On a weekly basis, the ringgit appreciated versus the US dollar to 4.1070/1100 from 4.1275/1285 a week earlier.
The local note was mostly higher against other major currencies, except the yen.
It slipped against the yen to 3.7500/7531 from 3.7482/7494 a week earlier, while it increased versus the British pound to 5.8094/8140 from 5.8313/8327 previously.
The ringgit also rose against the euro to 4.9908/9945 from 5.0013/0025 and strengthened against the Singapore dollar to 3.1034/1059 from 3.1076/1086 in the preceding week. - Bernama