KUALA LUMPUR: The ringgit is expected to continue its positive momentum next week, trading between 3.80 and 3.90 versus the US dollar, boosted by global sentiment.
Affin Hwang Investment Bank vice-president/head of retail research Datuk Dr Nazri Khan Adam Khan said earlier this week, the US had posted a set of poor economic data, causing the Federal Reserve to slow down its intention to raise interest rates in April.
He said following the decline in the economic data, the greenback declined to its worst quarter in six-and-a-half years and investors shifted their interest to other currencies, including the ringgit.
“The dollar index was down at 94.60 on Friday,” he told Bernama, adding that if the slide were to continue, there is no doubt the ringgit would hit its new highest level of 3.70, which it last met eight months ago.
More foreign funds have been seen flowing into the country as a result of improvement in the Malaysian economy and this will spur confidence among investors, he added.
Meanwhile, FXTM vice-president of corporate development & chief market analyst Jameel Ahmad was reported as saying that the ringgit was now moving up and recovering from its steep and traumatic losses in the past year.
He said among the factors that contributed to the ringgit rally were improvement in oil prices which was now above US$35 per barrel.
It seems like oil are going to be traded at between US$35 and US$44 per barrel, creating an optimism and more positive outlook for Malaysia, which is an oil exporting country, he added.
Other factors that boosted the local currency are tax increases, spending cuts and 1Malaysia Development Bhd’s sale of its energy assets and repayment of RM6 billion (US$1.5 billion) in debts in the coming weeks.
For the week just ended, the ringgit trended higher during the whole week, breaching its highest level of 3.80 versus the US dollar, as buying demand continued.
It ended at 3.8880/8950 on Friday against the greenback from 4.0330/0410 the previous week.
The local unit gained against the Singapore dollar to 2.8826/8895 from 2.9408/9477 and improved versus the yen to 3.4603/4675 from 3.5697/5777.
It also advanced against the British pound to 5.5692/5815 from 5.6990/7124 and appreciated against the euro to 4.4315/4411 from 4.5020/5118. --BERNAMA