ANN/THE STAR – The ringgit is projected to trade between 4.41 and 4.42 against the United States (US) dollar next week, according to an analyst.
Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the tremor from the US tariff shock would continue to reverberate, leading traders and investors to adopt a defensive stance.
“I sense that market participants will be searching for more clues on whether the US Federal Reserve would ease the monetary policy beyond half a point cut as indicated in their March projection.
“Against such a backdrop, the US Consumer Price Index (CPI) for March will be closely scrutinised on Thursday. At the current juncture, the current support and resistant level lies at 4.3634 and 4.4463 for the ringgit-US dollar,” he told Bernama.
Meanwhile, SPI Asset Management managing director Stephen Innes expects the ringgit to move around 4.42 to 4.45 versus the greenback next week.
He said China’s deflation pressures would take centre-stage, with CPI and Producer Price Index (PPI) releases due.
“If the numbers confirm sluggish domestic demand, that could sour regional risk sentiment and spill over to the ringgit.
“I would also keep a close eye on the Bank of Japan, they are expected to hold, but if they sound more dovish on the global outlook, it could have ripple effects across Asia. Markets would read that as a potential green light for regional interest rate cuts, which would weigh on local currencies,” said Innes.
On the ringgit, he said if Malaysia could extract some trade concessions, that could stabilise sentiment quickly.
“But make no mistake, the elephant in the room is China. What the People’s Bank of China does with the yuan will be the regional anchor, and if they start nudging it weaker, the ringgit and others will likely take their cue from there,” he added.
For the holiday-shortened week, the local currency ended the week marginally lower at 4.4335/4400 against the greenback, lower than the 4.4330/4355 recorded in the previous week.
