KUALA LUMPUR – The ringgit will likely gain momentum next week as the US dollar retreats its gains, following the release of a weaker-than-expected US retail sales data.
Affin Hwang Investment Bank head of retail research and vice-president Datuk Dr Nazri Khan said the weak retail sales data would prompt further speculations over the outlook of the Federal Reserve’s policy.
“The unfavourable retail sales data can potentially refrain the Federal Reserve from increasing its interest rates,” he told Bernama.
A dealer said while market sentiment on the global oil price remained bearish, some traders viewed that this would not severely affect Malaysia, given its waning reliance on the oil and gas sector.
For the week just ended, the ringgit touched its six-year low on Wednesday at the 3.7 level against the greenback, but subsequently firmed up to the 3.6 level after Bank Negara Malaysia governor Tan Sri Dr Zeti Akhtar Aziz said it was “significantly undervalued” at that trading level.
On a Friday-to-Friday basis, the ringgit depreciated to 3.6840/6870 against the US dollar from 3.6515/6545 previously. However, it appreciated to 2.6584/6623 against the Singapore dollar from 2.6655/6681 last week and rose to 3.0343/0373 against the yen from 3.0401/0436 last Friday.
Against the British pound, the ringgit strengthened to 5.4807/4874 from 5.5550/5603 and was traded significantly higher against the euro to 3.9117/9156 from 4.0148/0192. â€“ Bernama