MUFG Bank's Lloyd Chan expects the ringgit to strengthen to 4.15 per US dollar by year-end.
Kuala Lumpur: The ringgit is hovering near its strongest level in a year, supported by expectations that the central bank will hold its policy rate steady and by renewed optimism over growth.
The ringgit is 0.6% away from breaching the 4.1805-per-US dollar level that would mark its highest since October last year.
Expectations of an extended hold from Bank Negara Malaysia (BNM), an improving growth outlook, and foreign debt inflows are providing a tailwind for the currency.
The ringgit will be supported by the nation’s “resilient macro fundamentals, prudent fiscal management, and narrowing policy rate gap with the United States,” said Lloyd Chan, a strategist at MUFG Bank Ltd.
He expects the currency to strengthen to 4.15 per US dollar by year-end.
Malaysia’s currency is among the top performers in Asia this year after gaining about 6.4%. It is also poised for its biggest annual advance since 2017.
Malaysia’s trade-dependent economy has been buoyed by signs that global demand is picking up. — Bloomberg
