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Malaysia: Ringgit continues to climb to 19-month high
KUALA LUMPUR: The ringgit continued its upward momentum to open at a 19-month high of 3.9880/9930 against the US dollar Monday, on improved sentiment towards the local note.
It was prompted by the strong trade surplus, as well as, expectations of a hike in the Overnight Policy Rate (OPR) by Bank Negara Malaysia this year.
The local unit, which last touched the 3.98 level on July 19, 2016, was up 70 basis points against last Friday’s close of 3.9950/9000.
In a note, RHB Research said the ringgit strengthened by 1.7 per cent to RM3.9985 to the US dollar in the first week of January 2018, after appreciating by 0.6 per cent in December 2017.
“The stronger ringgit is most likely due to a strong trade surplus, as well as higher oil prices during the period. This is accompanied by expectations of a hike in the OPR by the central bank this year.
“For the full year of 2017, the ringgit strengthened by 9.5 per cent, after depreciating by 4.5 per cent in 2016,” it said.
Moving forward, the research house expects the ringgit to strengthen gradually to RM3.95 against the US dollar at the end of 2018, from RM4.062 as at end-2017, driven by a surplus in the current account.
RHB Research said the US dollar would likely decline given expectations of a stronger Euro as the European Central Bank moves to taper its quantitative easing, and this, in turn, suggests that emerging currencies like the ringgit could strengthen against the US dollar as well in 2018.
Meanwhile, the ringgit traded mostly higher against a basket of major currencies.
It appreciated against the Singapore dollar to 3.0062/0102 from 3.0081/0123 on Friday and rose against the yen to 3.5258/5311 from 3.5279/5333.
The ringgit was higher against the euro at 4.8027/8092 from 4.8116/8192, but fell against the British pound to 5.4121/4205 from 5.4048/4132. – Bernama
The following table shows rates for Asian currencies against the dollar on Monday Jan 8 at 1000 Malaysian time.
CURRENCIES VS U.S. DOLLAR
Change on as of 0200 GMT
Currency Latest bid Previous day Pct Move
Japan yen 113.120 113.06 -0.05
Sing dlr 1.327 1.3261 -0.08
Taiwan dlr 29.469 29.523 +0.18
Korean won 1066.000 1062.7 -0.31
Baht 32.120 32.22 +0.31
Peso 49.870 49.865 -0.01
Rupiah 13397.000 13413 +0.12
Rupee 63.365 63.37 0.00
Ringgit 3.986 3.995 +0.23
Yuan 6.484 6.4887 +0.07
Change so far
Currency Latest bid End 2017 Pct Move
Japan yen 113.120 112.67 -0.40
Sing dlr 1.327 1.3373 +0.77
Taiwan dlr 29.469 29.848 +1.29
Korean won 1066.000 1070.50 +0.42
Baht 32.120 32.58 +1.43
Peso 49.870 49.93 +0.12
Rupiah 13397.000 13565 +1.25
Rupee 63.365 63.87 +0.80
Ringgit 3.986 4.0440 +1.46
Yuan 6.484 6.5069 +0.35
– Reuters
Source: https://www.thestar.com.my/business/business-news/2018/01/08/ringgit-continues-to-climb-to-19th-month-high/#rO1Q8b2JIg2BFArw.99