Kuala Lumpur (April 23): Ringgit is expected to stabilize against the US dollar next week as the US Federal Reserve (Fed) is about to enter a blackout period ahead of its two-day meeting from May 3.
Mohamed Afzanizam Abdul Rashid, chief economist at Bank Islam Malaysia Bhd, said Fed officials would refrain from commenting on monetary policy, giving some support to the local currency.
“We also consider the possibility of some sort of correction over the next week as technical indicators indicate that Ringgit is in an oversold position, indicating that there is great potential for a correction,” he added. Burnama.
Commenting further on the trend next week, he said that the resistance and support levels are at 4.34 and 4.228 respectively against the US Dollar.
“I think it will turn around this level and Ringgit’s performance is very volatile at the moment,” he added.
Meanwhile, Stephen Innes, SPI Asset Management Partner, believes that since China has imposed another lockdown and the lack of mobility restrictions in China as well as the People’s Bank of China’s policy easing, there is no end in sight, Will continue to weaken together with Ringgit. Yuan.
“I think Ringgit will trade between 4.3165 to 4.3475 against the US Dollar next week,” he said.
On a weekly basis, the ringgit was lower against the greenback at 4.3230/3270 on Friday (April 22), compared to 4.2330/2380 a week ago.
The ringgit ended lower and traded higher at 4.30 against the US Dollar on Friday, last seen in June 2020.
In terms of year-on-year performance, the local currency declined by 2.75%, reflecting weak global sentiment and keeping pace with the Chinese yuan.
Meanwhile, the local unit traded lower against a basket of major currencies on a Friday to Friday basis.
The ringgit fell from 3.1198/1242 a week ago to 3.1633/1667 against the Singapore dollar, and slid from 3.3465/3510 to 3.3652/3686 against the Japanese yen.
The local currency weakened against the British pound from 5.5308/5374 last week to 5.5641/5693, and declined from 4.5776/5830 to 4.6710/6753 against the euro.