KUALA LUMPUR, Jan 17 – The ringgit, which ended the week on a weaker note, is expected to trade between 3.51 and 3.59 against the US dollar next week, a dealer said. The direction of crude oil prices coupled with the US dollar’s performance and Switzerland’s surprising move to scrap its cap on the franc continued to weigh on the local unit.
The ringgit fell to a five-and-a-half year low against the greenback on Tuesday, dented by renewed slide in crude oil prices. Yesterday, however, the ringgit edged up due to market positioning following Switzerland’s unexpected move to cut its cap on the franc, contributing to the local currency’s movements. The dealer said uncertainties over the direction of the market, despite the boost, had put investors in a cautious mood.
“However, I doubt that the ringgit would breach 3.60 next week.” Affin Hwang Investment Bank head of retail research Datuk Dr Nazri Khan said the local note continued to drift downwards, a more measured response towards external situation including the greenback strength and commodities weakness rather than due to deterioration of Malaysian fundamentals. For the week just-ended, the ringgit inched up to 3.5580/5610 against the US dollar from last Friday’s 3.5610/5640 and traded mixed against other major currencies.
It depreciated against the yen to 3.0522/9561 from 2.9819/9857 last Friday and weakened vis-à-vis the Singapore dollar to 2.6867/6898 compared with 2.6596/6623 previously. The local unit strengthened against the euro to 4.1319/2361 from last Friday’s 4.2038/2084 but fell against the British pound to 5.4096/3156 from 5.3825/3881 last week.