BANK Muamalat Malaysia Bhd’s chief economist and head of social finance Mohd Afzanizam Abdul Rashid said the ringgit is expected to strengthen further next week between the range of RM4.72 and RM4.73 against the US dollar. 

He said the ringgit staged a further recovery against the US dollar yesterday and throughout this week, major central banks were seen to have kept their benchmark interest rates unchanged, signalling the rate hike cycle may have peaked. 

“The next question is how long the prevailing interest rate will hold and when will the central bank begin to ease the monetary policy. 

“So, this will be based on the incoming data points before any shift in stance would occur. The ringgit has also been in an oversold position for some time,” he said. 

On Thursday, Bank Negara Malaysia (BNM) announced it had maintained the overnight policy rate (OPR) at 3%, marking the third consecutive session that the Monetary Policy Committee (MPC) had opted for a rate hike pause, despite calls to raise the key interest rate to help stabilise the ringgit, which is near a 25-year low against the US dollar. 

The last rate hike was in May, when the central bank increased the OPR by 25 basis points to 3%. 

Meanwhile, SPI Asset Management managing partner Stephen Innes said he expected the ringgit rally to extend on the dovish US Federal Reserve (Fed) pivot, but gains could be limited by local and European economic concerns. 

“So, I expect 4.7150 to 4.7350 with a slightly stronger ringgit bias due to the Fed’s dovish pivot,” he said. 

On a Friday-to-Friday basis, the ringgit strengthened against the US dollar to 4.7265/7320 from 4.7750/7800 a week earlier after BNM kept the OPR unchanged in its last MPC meeting this year. 

The local unit has also appreciated against most major currencies. 

It increased against the euro to 5.0318/0377 from 5.0438/0491 a week ago, improved versus the Japanese yen to 3.1445/1484 from 3.1827/1862 and strengthened vis-a-vis the British pound to 5.7734/7801 from 5.7945/8005 a week earlier.  

The ringgit was traded mostly lower against its Asean peers, except against the Singapore dollar, rising to 3.4713/4756 from 3.4867/4906. 

The local note depreciated against the Indonesian rupiah to 300.5/300.9 from 299.5/300.0 last week, was easier against the Philippine peso to 8.42/8.44 from 8.38/8.39 and went down against the Thai baht to 13.2332/2553 from 13.1808/2008. – Bernama.