KUALA LUMPUR: The ringgit is likely to advance to the 3.95 level against the US dollar next week, prompted by the robust trade data released recently on the back of firmer crude oil prices and the weakness in the greenback.
Oanda Corp Head of Trading for Asia-Pacific, Stephen Innes, said the better-than-expected November Industrial Production Index data released last Thursday accentuated the resilience of the domestic economy.
“This is sending a robust signal for Bank Negara Malaysia to up interest rate in January,” he told Bernama.
Innes said strong crude oil prices, which moved above US$69 (US$1 = RM3.97) per barrel recently amid a softer greenback, would bring the 3.95 level versus the US dollar into play, possibly as early as next week.
“The RM3.95-RM4 vis-a-vis the greenback is my expected range for next week with a stronger ringgit bias.
“The only potential hiccup I see heading into next week is a possible escalation of US trade protectionism which could dampen regional sentiment,” he said.
On a Friday-to-Friday basis, the ringgit was stronger against the US dollar at 3.9700/9730 from 3.9950/9000 the previous week.
However, it was traded mixed against a basket of major currencies.
It climbed against the Singapore dollar to 2.9895/9924 from 3.0081/0123 the previous week and appreciated vis-a-vis the pound to 5.4040/4084 from 5.4048/4132 last week.
The local unit eased against the yen to 3.5727/5761 from 3.5279/5333 last Friday and versus the euro, it slipped to 4.8128/8181 from 4.8116/8192 last Friday. - Bernama