Business

Ringgit likely to rebound next week, says analyst

The ringgit is likely to rebound next week in line with the FTSE Bursa Malaysia KLCI (FBM KLCI), following the bullish global stocks recovery and European optimism.

Affin Investment Bank Vice President and Head of Retail Research Dr Nazri Khan said the unexpected dovish policy of the Bank of England (BoE) and European Central Bank (ECB), the easing credit concerns in China as well as hopes that the US Federal Reserve may hold back from reducing stimulus.

"We noticed a positive jump in global equities after the BoE and the ECB caught the markets off-guard with comments aimed at countering rises in market interest rates.

"The BoE and ECB statement that the recent market expectations on interest rate rises in 2015 are unwarranted and those rates would remain low for an 'extended period' suggests global central bankers determination to safeguard the fragile recovery of the eurozone," he told Bernama.

Throughout the week, investors remained on the sidelines, awaiting for stronger cues from the US jobs report before they take buying positions.

The local unit, which was on a downtrend this week, picked up on Thursday on mild buying interest amid the uncertain external economic environment such as the political turmoil in Portugal.

On a Friday-to-Friday basis, the ringgit fell against the greenback to 3.1870/1900 from 3.1590/1620 last Friday.

The ringgit strengthened against the Singapore dollar to 2.4967/4996 from 2.5010/5051 last Friday and emerged against the yen to 3.1860/1897 from 3.1925/1962 previously.

The local unit appreciated against the British pound to 4.7773/7824 from last Friday's 4.8159/8221 and was higher against the euro at 4.1049/1097 from 4.1212/1258 previously. - Bernama, July 6, 2013.

Comments