US-china tension to weigh on ringgit next week

: The ringgit is expected to remain on a downtrend next week, in line with most Asian currencies as the US- trade tension is likely to further dampen risk assets.

FXTM market analyst Han Tan said the US , retail sales, and industrial production data due in the week ahead could help shape the outlook on the country’s monetary policy, as the greenback sways to shifting market expectations over the next Federal Reserve interest rate cut.

“China’s July industrial production and retail sales announcements could also influence broader sentiment surrounding Asian assets, given the region’s overall reliance on China,” he told Bernama in an email.

Tan said the 4.20 resistance level remains the psychologically important resistance level for the local note next week, while a break below the 4.16 level could be met with stronger support at the currency pair’s 50-day moving average of 4.14 level.



On the domestic front, ’s July inflation print and the second-quarter gross domestic product announcements due in the week ahead could well feature into Bank Negara’s policy outlook.

“With several regional central banks recently announcing larger-than-expected rate cuts, the easing bias among Asian policymakers has become more pronounced, especially in light of the deteriorating outlook,” he added.

For the week just-ended, the ringgit fell as much as 0.29% to its lowest level in more than two months against the as investors remained concerned about the worsening US-China trade tensions.

On a Friday-to-Friday basis, the ringgit was lower at 4.1830/1860 against the greenback compared with last Friday’s 4.1550/1600.

The local currency also traded lower against most other major currencies.

It depreciated against the dollar to 3.0259/0285 from 3.0168/0215 in the preceding Friday, weakened versus the yen to 3.9522/9561 from 3.8864/8922, fell against the euro to 4.6858/6908 from 4.6104/6176 and slipped against the pound to 5.0652/0705 from 5.0379/0457 previously. — Bernama

Source: The Sun Daily







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