FXTM Research Analyst Lukman Otunuga said with the US dollar heavily supported by the interest rate hikes expectations, the ringgit had the scope to trade towards the 4.17 level against the greenback in the near term.
“Other than that, external factors in the form of trade war worries and global growth concerns also present downside risks to the ringgit,” he told Bernama.
It was reported that the yuan dipped to a 22-month low versus the US dollar on Thursday after the US Treasury declined to label China a currency manipulator amid escalating tariff battle between the two economic giants.
“This suggests that regional currency, including the ringgit, will undoubtedly remain a hostage to the yuan’s underlying movement, which could be a very a disruptive force for local (Malaysia) sentiment,” Innes added.
For the week just-ended, the ringgit was traded mixed versus the greenback, mainly influenced by the ongoing trade tension between the US and China, the mid-term review of the 11th Malaysia Plan and the hawkish US Federal Reserve’s latest meeting minutes which signalled at more interest rate hikes ahead.
On a Friday-to-Friday basis, the local note weakened to 4.1560/1600 against the US dollar from 4.1530/1560.
Against a basket of major currencies, the local note, however, was traded mostly higher.
It appreciated against the Singapore dollar to 3.0129/0169 from 3.0149/0175 last Friday, strengthened against the British pound to 5.4132/4205 from 5.4861/4917 and advanced against the euro to 4.7619/7674 from 4.8092/8139 previously.
Vis-a-vis the Japanese yen, the ringgit eased to 3.6982/7027 from 3.6971/7008 last Friday. — Bernama
Source: The Malay Mail Online