KUALA LUMPUR: The ringgit is expected to trade in a tight range against the US dollar next week as investors continue to monitor various global economic data to chart the direction of the market, an analyst said.
Stephen Innes, managing partner of SPI Asset Management, said the recent visit to Taiwan by US House of Representatives Speaker Nancy Pelosi rattled the market amid concerns over escalating US tensions. -sino.
“However, investors appeared to distract from the geopolitical event. Even as the Taiwanese fracas passes, worries about China’s domestic economy overshadow positive risk sentiment.
“In addition, China continues to politicize COVID-19 controls, which are expected to last until the end of this year and cause further damage to the national economy, and this is expected to keep the ringgit grounded next week.” , he told Bernama.
Going forward, he said, U.S. nonfarm payrolls data released on Friday is unlikely to swing currency markets, traders will remain focused on the consumer price index ( CPI) next week, which will undoubtedly provide the main catalysts for the currency market.
“If the CPI print comes in below expectations and confirms the spike in inflation in the US, the US dollar will sell off and the ringgit should strengthen a bit.
“Looking at current sentiment, Innes said the ringgit is likely to be defensive, trading in a cautious mode, in the 4.4450-4.4560 range against the US dollar next week,” he said. .
In the past week, the ringgit has traded mostly lower against the US dollar, except for Friday, as the geopolitical event in Taiwan and the hawkish statement by Federal Reserve officials have continued to dominate market sentiment, reinforcing the greenback’s appeal as a safe bet. -haven trump.
On Friday, the ringgit strengthened against the greenback to 4.4490/4520 from 4.4495/4520 a week earlier.
The local note, however, traded lower against a basket of major currencies, except against the British pound, on a Friday-Friday basis.
It depreciated against the Singapore dollar to 3.2330/2355 from 3.2243/2266 last week and depreciated against the Japanese yen to 3.3459/3484 from 3.3347/3368 previously.
The local unit fell against the euro to 4.5513/5544 from 4.5385/5410 a week earlier but improved against the pound to 5.3989/4025 from 5.4048/4078.-Bernama