Ringgit to trade on defensive mode next week

Ringgit to trade on defensive mode next week

KUALA LUMPUR,. The ringgit is expected to trade more defensively against the US dollar next week due to the escalating budget noises and maintain last week’s level of 4.14 to 4.16 per greenback, says OANDA Head of Trading in Asia-Pacific Stephen Innes.

“This is despite the positive news that the US Treasury Department’s staff advised Secretary Steven Mnuchin that China isn’t manipulating the yuan.

“So, if Trump and Mnuchin accept these findings at face value, which the market agrees with, it could avert an emerging market Asia currency meltdown and would forestall an escalation of the US-China trade war.

“This would also suggest we will not move above 4.16 next week,” he told Bernama.

However, Innes noted that improving risk sentiment would support oil prices, which underpin sentiment on the local note.

Yesterday, benchmark Brent crude oil was traded at US$80.58 per barrel, up by 0.40 per cent.

On a Friday-to-Friday basis, the ringgit depreciated to 4.1530/1560 against the US dollar from 4.1440/1490.

Against a basket of major currencies, the local note was traded lower.

The ringgit decreased against the yen to 3.6971/7008 from 3.6383/6443 last Friday, and weakened against the euro to 4.8092/8139 from 4.7639/7714.

The local note declined against the Singapore dollar to 3.0149/0175 from 2.9975/3.0022 and fell against the British pound to 5.4861/4917 from 5.4017/4091. ? Bernama