Saturday, April 9, 2011

Ringgit's uptrend set to continue

The ringgit is expected to strengthen further against the greenback next week as persistent funds flowed into the country to boost the local unit, dealers said.

The uptrend, seen since last Friday, continued unabated this week as the market reacted positively to a rate hike by the European Central Bank (ECB) on Thursday which exerted some pressure on the US dollar worldwide.

They said market speculation of a further rate hike by the ECB was likely to push the local unit towards the 3.01 level, versus the US dollar, next week.

The dealer said the greenback was also under pressure on the possibility the US may face a government shutdown following President Barack Obama and the Congress's failure to approve the Federal budget. 

However, the dollar could find some support next week as demand resumed for the safe haven after Thursday's earthquake in Japan, Portugal's budget deficit and the depreciation of the euro after its recent high. 

For the week just-ended, the market moved within a tight range, touching a high of 3.02 on Friday, but came off its highs on profit taking. 

The ringgit closed little changed versus the US dollar at 3.0215/0232, from the 3.0250/0260, recorded last Friday.

It depreciated against the Singapore dollar to 2.4034/4049, from 2.3977/3991 previously, but rose against the Japanese yen to 3.5455/5484 from last week's 3.6137/6166. 

The local unit was also lower against the British pound at 4.9565/9605, from 4.8506/8531 previously, and dipped against the euro to 4.3519/3549 from 4.2849/2872, last Friday. -- Bernama

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