KUALA LUMPUR: The ringgit is projected to strengthen to between 4.58 and 4.54 against the dollar by year-end, due to expectations of a softer dollar and declining U.S. Treasury yields with the Federal Reserve pursuing rate-cuts this year.
OCBC Bank chief economist Selena Ling said that Malaysia's economy is expected to receive a boost from the stabilisation of China's economy, with continued strength of inbound tourism.
"On improving the domestic fundamentals, we expect to remain supportive of the currency," she added.
Ling anticipates the ringgit to fluctuate between 4.58 an 4.54 against the dollar by end of 2024.
On the Red Sea shipping crisis, Ling underscored that as long as the situation remains unresolved, global repercussions can be anticipated.
"It's important to note that markets tend to approach geopolitical events with initial trepidation."However, over time, as people navigate challenges such as supply chain adjustments and finding alternative sources, situations tend to stabilise, though not necessarily returning to the exact equilibrium before the event," she said.
Ling was speaking to the media at OCBC's Economic Outlook 2024 press conference today.