KUALA LUMPUR – The ringgit is expected to trade in tight range with a slight appreciation bias next week, as technical indicators suggest that the United States dollar index is in the midst of an overbought position.
Bank Islam Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said the local note will likely move between 4.17 and 4.18 against the greenback.
“Next week, investors will be closely monitoring the Organisation of the Petroleum Exporting Countries and allies’ ministerial meeting, as well as key data points from the US, such as the non-farm payrolls for September,” he told Bernama.
Meanwhile, Kenanga Investment Bank Bhd said the ringgit may gather some strength and slightly appreciate against the dollar amid positive sentiment surrounding the reopening of the economy.
“This is despite the strengthening of the US dollar due to the global risk-off mode on the back of the rising inflation outlook, Federal Reserve’s hawkish tone, and US fiscal uncertainty.”
Putrajaya on Wednesday announced that more states would move up the phases of the National Recovery Plan, with the Klang Valley entering Phase 3 yesterday, leading to the reopening of more economic sectors.
During the week, the ringgit was mostly higher versus the greenback following improved sentiment after the tabling of the 12th Malaysia Plan in Parliament on Monday.
On a weekly basis, the ringgit strengthened to 4.1770/1810 vis-a-vis the dollar yesterday from 4.1865/1890 previously.
It also traded higher against other major currencies.
The local note improved against the Singapore dollar at 3.0756/0788 from 3.0981/1004 a week before, and rose against the British pound to 5.6373/6427 from 5.7359/7393.
It performed better against the euro to 4.8361/8408 from 4.9120/9150, and appreciated against the Japanese yen to 3.7580/7616 from 3.7925/7951. – Bernama, October 2, 2021
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