KUALA LUMPUR – The ringgit is likely to trade under pressure against the United States dollar next week amid profit-taking activities, said an analyst.
Bank Islam chief economist Mohd Afzanizam Abdul Rashid said the appreciation of the local note had continued since Thursday, ending the week at 4.1300.
Yesterday, the dollar index was seen declining to 92.371 despite better-than-expected jobless claims for the week ended September 4.
Afzanizam said the delay in the tapering of asset purchases may have been the driving force for emerging market currencies, including the ringgit.
“Hence, markets shall see whether such a thesis will last despite the high Covid-19 vaccination rate in developed countries,” he told Bernama.
“More importantly is how the high vaccination rate translates into the reopening of the economy, which would then accelerate economic activities.”
In the event this happens, he said, talks of asset purchases will resurface, resulting in volatile movements in the currency market.
“At this level, the speed of the ringgit appreciation has been remarkable.”
For the week just ended, the local note traded mostly higher throughout the week as the greenback continued to fall.
On a weekly basis, the ringgit strengthened to 4.1340/1370 against the US dollar yesterday from 4.1445/1475 previously.
It also traded higher against other major currencies in the same period.
The ringgit was slightly higher against the Singapore dollar at 3.0867/0892 from 3.0876/0903, and rose against the British pound to 5.7347/7388 from 5.7352/7393.
It widened against the euro to 4.8934/8970 from 4.9195/9231, and advanced on the Japanese yen to 3.7592/7623 from 3.7705/7735. – Bernama, September 11, 2021
