RINGGIT remained strong and rose to a two-month high against the US dollar on continued confidence that the US will moderate future interest rate hikes and a smooth government transition in Malaysia.
At 6pm, the local currency continued to strengthen to 4.4795/4890 against the US dollar from Thursday’s close of 4.4910/5000.
Inflation in the US in October eased to 7.7 percent from 8.2 percent in September, fueling hopes of a 50 basis point interest rate hike in December.
The Managing Director of SPI Asset Management, Stephen Innes said, the US Federal Reserve (Fed) is expected to reduce the rate of increase from 75 basis points to 50 basis points in December in line with previous projections.
Traders can also receive other US economic data such as new home sales, which jumped 7.5 percent in October after shrinking 11 percent in September. Also, first-time claims for jobless benefits rose more than expected in the week ending November 19.
In Malaysia, Innes said, the market found the Prime Minister, Datuk Seri Anwar Ibrahim to be a market-friendly figure.
The more attractive Malaysian stock market and ringgit (rate) also depend heavily on China’s expected reopening.
“The waning concerns about new sanctions (in China) will boost all Malaysian assets again. So, it will benefit the ringgit next year … obviously we have reached the peak of a firm action by the Fed (on interest rates), which is good for Asian currencies,” he told Bernama.
Innes said, as the ringgit is driven by trade and investment flows, there should be an increase in international inflows, which will be very positive for the local currency.
Meanwhile, the ringgit traded higher against a group of major currencies.
The local unit rose against the Singapore dollar to 3.2573/2645 from 3.2678/2749 at Thursday’s close and rose against the euro to 4.6551/6650 from 4.6792/6886.
It also rose against the British pound to 5.4094/4209 from 5.4305/4414 and rose against the Japanese yen to 3.2118/2188 from 3.2412/2479. – Named
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