KUALA LUMPUR: The ringgit is expected to remain volatile next week, driven by negative sentiment brought by China’s shrinking economy and continued worries over commodity prices, dealers said.
Affin Hwang Investment Bank Vice-President/Head of Retail Research Datuk Dr Nazri Khan Adam Khan said the local unit is expected to trend lower next week due to falling oil prices and a major trading halt in the Chinese stock market, which may dent the short-term traders psychology.
“The recent turmoil in China’s stock markets and further strengthening of the US dollar kept the pressure on global equities, funds outflows and fuelled further selling of the ringgit as investors were shifting to gold as a safe-haven.
“The renewed weakness for the ringgit at 4.400 level put the currency on track for the lowest finish since November 2015,” he told Bernama.
Meanwhile, earlier this week, China introduced a stock market circuit-breaker mechanism to curb losses in its equity market, which saw its stock market shutting down prematurely.
On the home front, Prime Minister Datuk Seri Najib Tun Razak said some adjustments would be made to the 2016 Budget to reflect realistic situation due to the strengthening of the US dollar and declining oil and major commodity prices.
For the week just ended, the ringgit depreciated against the greenback to 4.3800/3900 from last Thursday’s 4.2900/2970.
It declined against the Singapore dollar to 3.0472/0550 from 3.0367/0423 last Thursday and eased against the yen to 3.6993/6093 from 3.5637/5698 last Thursday.
The ringgit went down against the euro to 4.7611/7737 from 4.6851/6940 and closed lower against the British pound to 6.4014/4182 from 6.3604/3716 previously. --Bernama