Kenanga maintains year-end ringgit forecast at 4.15 to US dollar

KUALA LUMPUR: Kenanga Investment Bank Bhd is maintaining its year-end ringgit target against the US dollar at 4.15, while continuing to test the 4.20 level in the near-term.

In a note today, the research house said the Federal Reserve (Fed) on Wednesday, in deciding to hike its short-term rate by 25 basis points, would cast a pall on a strong US dollar in 2019.

“This may also mean cutting the slack on downward pressure of the emerging market currencies. 
Though, we expect downward pressure on the ringgit continuing to spill over into 2019 due to uncertainty in the global economy, it would somewhat be less,” it said.

On the domestic front, Kenanga Investment said the Fed's less hawkish signal and tapering of its planned rate hikes would provide more room for Bank Negara Malaysia (BNM) to maintain its accommodative stance on monetary policy.  

“We expect BNM to maintain its accommodative monetary stance and maintain the overnight policy rate at 3.25 per cent in 2019,” it added. - Bernama 
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