KUALA LUMPUR: The ringgit rose against the US dollar following Bank Negara Malaysia’s upbeat tone in growth and the improving oil prices said currency analysts.
The ringgit traded at 4.1488 versus the US dollar yesterday morning and closed at RM4.1918 at 5 pm versus 4.2065 at Thursday’s close.
Maybank FX said the BNM shift is expected to add to its positive outlook on the ringgit.
“We had earlier shared that current external environment of monetary policy continuity in US, still subdued inflationary pressures in US.
“The synchronised global economic recovery should continue to bode well for robust Asian exports recovery and benefit countries that are trade-dependent including the ringgit.”
Domestic resilience, supported investor sentiment (elections next year and positive development to deepen financial markets) and room for commodity prices to pick up should also further support the ringgit.
Ambank group is looking at the ringgit strengthening to 4.205 for 2018.
“The stronger ringgit outlook against the US dollar is supported by improving sentiments.
BNM external reserves improved to US$101.4 billion at end-October, net foreign inflow into equities market at RM9.8 billion at end-October, foreign holdings in MGS at 42.7 per cent and a more stable foreign currency deposits at around 7 per cent.
“ More importantly, BNM cited the need to review the current accommodative policy on the back of the present growth momentum.”