BERNAMA – The Malaysian ringgit is expected to trade in a tight range at MYR4.67 to MYR4.68 against the United States (US) dollar this week as traders seek fresh leads for market direction.
Bank Muamalat Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said market chatter over possible interest rate cuts in the US may gain momentum this month. He said it all started with the US nonfarm payroll (NFP) which came in lower than expected, followed by the country’s inflation rate which decelerated to 3.2 per cent in October after sustaining at 3.7 per cent in the past two months.
US jobless claims rose to 231,000 last week from 218,000, suggesting that the labour market is softening.
“The question now is when the US Federal Reserve (Fed) will cut the rate and how steep the reduction is going to be. Nonetheless, the ringgit is expected to remain in a narrow range in the near term on uncertainties over the US rates.
“The focus next week will be on the US Federal Open Market Committee (FOMC) minutes as market participants would want to gain more insights on the latest Fed decision,” he told Bernama.
Hong Leong Researchsaid the ringgit this week rode on the trend of US dollar weakness seen elsewhere. However, the ringgit was weaker across the board versus most of the G10 currencies and major regional currencies, except for the Japanese yen and Hong Kong dollar.
“We are neutral-to-slightly bearish on USD/MYR for the week ahead,” it said.
On a Friday-to-Friday basis, the ringgit appreciated against the US dollar to 4.6785/6825 from 4.7065/7105 a week earlier.
The unit depreciated against major currencies.
