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Monday, February 17th, 2020

Ringgit to resume 2018 on stronger footing

by December 30, 2017 General

Malaysian ringgit notes are seen among US dollar bills in this photo illustration taken in Singapore. — Reuters picMalaysian ringgit notes are seen among US dollar bills in this photo illustration taken in Singapore. — Reuters picKUALA LUMPUR, Dec 30 — The ringgit’s rally is expected to continue into 2018, strengthening to the 4.00 region against the US dollar, on support from weak greenback sentiment and recovery in commodity prices.

Affin Hwang Investment Bank Vice President/Head of Retail Research, Datuk Dr Nazri Khan Adam Khan said the local unit, which ended 2017 on a strong note, would be traded positively next week and fuelled by positive local developments.

“It includes robust economic growth, bullish foreign fund inflows into Malaysia and a strong equity market performance.

“The prospect of a higher overnight policy rate will also help support sentiment in the market.

“The bull run will continue next year. We have a lot of strong catalysts driving the ringgit, with our reserves showing an increasing trend. These all bodes well for the ringgit,” he told Bernama.

The central bank’s international reserves amounted to US$102.2 billion (RM431.6 billion) as at Dec 15, 2017 compared with US$101.9 billion (RM430.4 billion) as at Nov 30, 2017.

Nazri Khan also said the improved household debt level, which declined to 84.6 per cent of the gross domestic product (GDP) as of September 2017 from 88.4 per cent overall last year, would also help drive ringgit momentum.

On a Friday-to-Friday basis, the ringgit was stronger against the greenback at 4.0440/0500 versus 4.0770/0800 in the previous week.

The local note traded mixed against a basket of major currencies.

It climbed against the Singapore dollar to 3.0265/0323 from 3.0317/0346 on last Friday, and rose against the yen to 3.5912/5968 from 3.5965/5998.

The ringgit, however, fell against the British pound to 5.4602/4687 from 5.4587/5639 and weakened vis-a-vis the euro to 4.8451/8535 from 4.8304/8344.

The local market was closed on Monday for the Christmas holiday. — Bernama