PETALING JAYA: Having made steady headway since the start of the year, the ringgit was, for a change, among the fastest-rising currencies against the weak US dollar.
The local currency had risen 2.5% over the past two weeks, and was at 3.3395 as at 5pm yesterday. Earlier this week, the ringgit hit 3.3365 against the greenback – its strongest since August 2008.
The Korean won appreciated 3.6% year-to-date and was the biggest mover among all major currencies followed by the Australian dollar’s 3.26% advance during the same period.
“I think this will be a bearish year for the US dollar and for the ringgit, we see room for further appreciation,” OSK Investment Bank head of treasury Yeo Chin Tiong told StarBizWeek yesterday.
OSK Investment forecast that the ringgit would rise to 3.20 against the US dollar by the end of 2010. The local currency inched up 1% last year, lagging behind sharp advances made by almost all other regional currencies.
Signs that international investors still favour assets in emerging markets, which are recovering faster from the global economic slump last year than countries in the West, would keep demand high for Asian currencies.
Emerging market funds took in US$$2.5bil in net inflows in the week ended Jan 13, according to data released yesterday by US-based fund tracker EPFR Global.
“The inflows are going to lift Asian currencies, especially now that the market is looking at a delay in Fed hikes,” Hong Leong Bank manager of economic and fixed-income research Choong Yin Pheng was quoted by Bloomberg as saying yesterday.
“The ringgit has done well for a laggard.”
Analysts said the prospects of rising ringgit could further boost returns on investment for foreign investors.
Year-to-date, the benchmark FTSE Bursa Malaysia KL Composite Index had gained 2% to close at 1,298 points yesterday. If measured in US dollar terms, the return was higher at 5%.
Earlier this week, Standard Chartered Bank predicted the ringgit will reach 3.15 against the US dollar by the year-end.
No comments:
Post a Comment