PETALING JAYA: The ringgit hit an eight-month high on the final day of 2019 at 4.0930 against the US dollar.
Throughout the year, the ringgit soared to a high of 4.0625 on March 21 and 22, 2019, before falling to a low of 4.2225 on Sept 3, 2019.
AMMB Holdings Bhd group CEO Datuk Sulaiman Mohd Tahir said the outlook for the ringgit remains tied to trade relations between the US and China.
“Should trade negotiations prove favourable, this could see a stronger renminbi against the US dollar, which would bode well for the ringgit to strengthen,” said Sulaiman.
BIMB Securities head of research Azharuddin Nordin said in a note that the ringgit is poised for further gains in 2020 on the favourable US-Malaysia interest-rate differential.
“The current interest-rate differential between the US federal funds rate and Malaysia’s Overnight Policy Rate is at 125 to 150 basis points. The ringgit has been traded in a range of RM4.20-4.10 since late 2018 due to issues surrounding slowing growth, funds outflow and political uncertainty, in our view. However, the immediate upside catalyst for the ringgit may be on the US-China trade war pause, if this happened in the first half of 2020.”
