RINGGIT

THE ringgit movement will be influenced by the development in the US monetary policy and Malaysia’s gross domestic product (GDP) data, a dealer said.

FXTM Global head of Currency Strategy and Market Research Jameel Ahmad said the ringgit and other emerging market currency movement would depend on the overall reaction to the upcoming US Federal Reserve’s interest rate decision.

“Until the GDP reading next Friday, the trajectory of the US dollar will play a major role in dictating fluctuations in the Malaysian ringgit,” he said in a statement today.

He said the GDP reading would provide indications for any signs of slowing down for one of the most important emerging markets in Asia.

A slowdown in economic growth was felt in other emerging markets in recent months as a result of the ongoing external uncertainties that are preventing investors from investing in emerging markets, he added.

Meanwhile, OANDA Head of Trading Asia-Pacific Stephen Innes said the ringgit is expected to test the 4.20 level against the US dollar in the coming weeks as the local unit continued to struggle due to the divergence of Bank Negara Malaysia and US Federal Reserve’s policies.

“The ringgit support stood at 4.16 against the greenback, while resistance 4.20. The 4.20 resistance call is coming nearly a month earlier than I had anticipated,” he added.