KUALA LUMPUR: The ringgit is expected to ease slightly against the US dollar next week amid subdued demand ahead of the Christmas and New Year breaks, moving between the 4.00-4.15 level.
AxiTrader chief Asia market strategist Stephen Innes said the local market is unlikely to experience big capital inflows next week but demand would be weighed by external factors.
Speaking to Bernama, Innes said he foresees the ringgit trading in a tight range of 4.1550 and below against the greenback even though the US-China trade deal had made some positive development.
Meanwhile, FXTM market analyst Han Tan said for the week ahead, the economic data releases that warrant investors’ attention include the US jobless claims and home sales, China’s industrial profits, as well as Singapore’s inflation and industrial production.
He said the economic prints would be set against the optimism surrounding the US-China trade deal that is expected to be signed next month, with markets adopting a risk-on tone as fears over a global recession subside.
Malaysia’s economic calendar for the week ahead would not feature any tier-1 releases, he said.
“For the week ahead, the immediate support level for the US dollar-ringgit could be drawn at 4.12 in the event of more dollar weakness.
“A sudden bout of risk aversion or dollar strength could result in the US dollar-ringgit breaking meaningfully above the 4.15 psychological level, which is also close to where the currency pair’s 200-day moving average lies, before seeing stronger resistance at 4.16,” he said.
For the week just ended, the ringgit moved between 4.1370 and 4.1410 against the US dollar and ended the week slightly lower at 4.1380/1420 on Friday from 4.1335/1355 on the previous Friday.
The local market was influenced mainly by external factors, particularly the US-China trade deal development, as well as US President Donald Trump’s impeachment.
Meanwhile, the local currency was traded mostly higher against a basket of other major currencies.
On a Friday-to-Friday basis, the ringgit rose against the Singapore dollar to 3.0518/0559 from 3.0566/0586, appreciated versus the British pound to 5.3955/3024 compared with 5.5443/5486 and strengthened against the euro to 4.6010/6067 from 4.6208/6247 previously.
However, the local note fell vis-a-vis the Japanese yen to 3.7842/7889 from 3.7694/7722 previously.