Kenanga lowers ringgit year-end target to 4.05

Kenanga lowers ringgit year-end target to 4.05

KUALA LUMPUR, June 14 — Kenanga Investment Bank Bhd is revising its year-end ringgit target against the US dollar to 4.05 from 3.90 forecast earlier.

In a note today, the research house said that it also anticipates the local currency to remain weak against major currencies.

“On the home front, the biggest risk to the monetary policy outlook is that a post-election sharp decline in investment would augment an economic slowdown,” it added.

Kenanga noted that Malaysia’s capital market has been experiencing large outflows of funds since the surprise outcome of the General Election in early May as well as the current policy changes and measures taken by the new Pakatan Harapan-led administration, mainly the zero-rating of the Goods and Services Tax and scrutiny of key infrastructure projects.

“To ensure capital market stability and ample liquidity as well as to support growth, we expect Bank Negara Malaysia to adopt an accommodative stance and hold the overnight policy rate at 3.25 per cent for the year and perhaps the next as well,” it added

— Bernama