Ringgit gains momentum on investor confidence
KUALA LUMPUR: The ringgit has regained momentum in recent months following higher investor confidence amid strong economic numbers and tempered optimism over the United States President Donald Trump’s campaign agenda.
FXTM vice-president of corporate development and market research, Jameel Ahmad, said the ringgit was now at its strongest level against the greenback since October last year.
“There is a combination of different factors that explain why the ringgit has gained of late.
“It was mainly driven by a decrease in optimism over Trump’s ability to push his campaign agenda forward without facing heavy legislative obstacles,” he said in a statement.
Jameel said on the domestic front, the recent first-quarter gross domestic product (GDP) growth of 5.6 per cent lifted investor confidence significantly, and had proven that the economy could maintain resilience in spite of currency turbulence.
“The GDP performance will continue to support investor sentiment, but central bank stability in terms of monetary policy will also support the ringgit,” he added.
Jameel said investors would be slowly lured back to international bond markets as the dollar had probably “topped” for some time, which should also support buying sentiment towards the ringgit as most emerging market currencies still appear undervalued. Zarina Zakariah
FXTM vice-president of corporate development and market research, Jameel Ahmad, says ringgit is now at its strongest level against the greenback since October last year.