Ringgit to stabilise against the US dollar next week

KUALA LUMPUR, Sept 18 (Bernama): The ringgit is likely to stabilise against the US dollar next week, driven by a bullish outlook on the global financial market, with the focus on the United States Federal Reserve (Fed), said an economist.

Bank Islam chief economist Dr Mohd Afzanizam Abdul Rashid said after experiencing a sharp appreciation, the ringgit succumbed to the selling pressure during this week, which could have been motivated by profit-taking activities in light of the rapid increase in the value of the ringgit.

"Next week, the US dollar/ringgit should stabilise around the prevailing level as investors will take a cue from the US Federal Open Market Committee (FOMC) meeting on Sept 21 and 22.

"Investor will be looking for clues at how the Fed would assess the recent data, particularly retail sales during August which had surpassed market consensus of 0.8 per cent contraction when the actual outturn saw retail sales growing positively by 0.7 per cent month-on-month,” he told Bernama.

Meanwhile, a dealer said the strong economic data from the world’s largest economy would provide an extra cushion to the greenback at the end of the week.

"This has great potential to cause the US dollar to appreciate over the next few days, as high consumer spending could signal to the Fed that it will have to cut financial stimulus, which currently stands at US$120 billion per month, sooner than expected,” he said.

He said the Fed is widely expected to announce the tapering of its asset purchases during the FOMC two-day meeting, following firmer US data.

From a technical point of view, he said if the US dollar-ringgit pair broke above the 4.1600 level, it could rise to 4.2300 in a few days.

On a weekly basis, the ringgit weakened to 4.1700/1730 against the greenback on Friday from 4.1340/1370 a week ago.

The ringgit also traded lower against other major currencies compared to a week earlier.

It was slightly lower against the Singapore dollar at 3.0985/1010 from 3.0867/0892 a week before and declined against the British pound to 5.7483/7525 from 5.7347/7388.

The local note also slipped against the euro to 4.9135/9170 from 4.8934/8970 and depreciated on the Japanese yen to 3.7913/7943 from 3.7592/7623 on the previous Friday. - Bernama

Article type: metered
User Type: anonymous web
User Status:
Campaign ID: 46
Cxense type: free
User access status: 3
Join our Telegram channel to get our Evening Alerts and breaking news highlights

Ringgit , Weekly , US dollar , FOMC , US Federal Reserve


Next In Aseanplus News

Cambodian govt approves US$8.5 billion for 2022 annual spending, up 8.4%
Laos: Annual Vientiane boat racing festival cancelled amid Covid-19 outbreak
80% full vaccination main criterion to de-escalation plans in Brunei
Indonesian court rejects debt restructuring request against airline Garuda
Thailand announces reopening rules for tourism reboot
China can’t look to Singapore for a way to live with Covid-19, health economist says
Geely’s Lynk & Co car brand launches mid-size SUV, heads to Saudi Arabia and Kuwait
Hong Kong jobless rate drops to new low of 4.5 per cent since start of coronavirus pandemic on improved economy
Covid-19: 5,828 new cases bring total to 2,426,050
Miti: European investors make strong commitment to invest RM14.1bil in Malaysia

Others Also Read