ZCZC
BCN-10
MALAYSIA-RINGGIT-USD
Malaysian Ringgit climbs on weak U.S. dollar sentiment
KUALA LUMPUR, Dec. 29, 2018 (BSS/Xinhua) – Malaysian Ringgit climbs against
the U.S. dollar for the third consecutive days on Friday, as the greenback
sentiment affected by U.S recent poor economic data.
The Ringgit opened higher against the U.S. dollar at 4.1655. At one point
it has risen 0.16 percent or 0.0068 to 4.1588. Year to date, the Ringgit has
still depreciated 2.76 percent against the U.S. dollar.
The U.S. dollar underperformed recently as U.S. consumer confidence fell
unexpectedly.
OANDA Asia-Pacific trading head Stephen Innes said in a note on Friday that
currency carry appeal has the Ringgit trading on better footing as the
markets continue to debate the next move by the U.S. Federal Reserve as a
growing chorus of support suggest the Fed will be on hold until mid of 2019
at least.
“A more dovish Fed will lend support to growth assets and carry trade, and
the Ringgit should benefit on both front,” he added.
While oil prices continued to be a concern, he opined that the commodity
will likely to benefit from stimulus measures in the form of more aggressive
tax cuts in some countries, and this should support the Ringgit.
“But liquidity remains very thin which is dissuading investors from
reengaging, so caution should be exercised in holiday-thinned markets,” he
said.
Meanwhile, some foreign exchange strategists foresee the Ringgit to recover
in the second half next year, due to U.S. economy weakens and the Fed turns
dovish.
TA Securities said in a recent note that it expects the Ringgit to recover
to 4.00 against U.S. dollar in the second half next year, after wavering
towards 4.25 against U.S. dollar in the first half.
The research house’s average forecast for Ringgit against U.S. dollar next
year is 4.15. It also expects crude oil price to recover to average 70 to 80
U.S. dollar per barrel next year, which would solidify the Ringgit.
BSS/XINHUA/HR/1335