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Ringgit Expected To Trend Lower Against The US Dollar

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KUALA LUMPUR – The ringgit is expected to trend lower against the US dollar
next week in anticipation of a possible interest rate hike by the US Federal
Reserve.

Affin Hwang Investment Bank Vice-President/ Retail Research Head Datuk Dr
Nazri Khan Adam Khan said most Asian currencies would also trend lower, given
the strong US dollar index following the possibility of interest rates being
raised at the next policy meeting on Sept 20-21.

“Market will react defensively, because if the US Federal Reserve were to
raise interest rates this month, we may see an outflow of foreign funds.

“There is also geopolitical tension caused by North Korea, as it
conducted its fifth and most powerful nuclear test on Friday,” he told Bernama.

Meanwhile, FXTM Research Analyst Lukman Otunuga said the European Central
Bank’s decision to keep its monetary policy stance unchanged on Thursday,
also pressured the Asian market.

“There could be further losses if risk aversion encourages investors to
scatter from riskier assets,” said a dealer.

On a Friday-to-Friday basis, the local note rose against the greenback to
4.0675/0725 from 4.0830/0900.

Against other currencies, the ringgit ended mostly lower against a basket of
currencies.

The ringgit slid against the Singapore dollar to 3.0030/0069 from
3.0018/0080 last Friday and eased against the yen to 3.9792/9852 from
3.9411/9498.

The local note fell against the euro to 4.5845/5905 from 4.5640/5734 but
strengthened against the British pound to 5.4118/4205 from last Friday’s
5.4161/3262.
— BERNAMA

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