Ringgit rebounds to close higher against US dollar

KUALA LUMPUR: The ringgit rebounded from last week’s loss to end slightly higher against the US dollar, amid growing concerns over the upcoming US Federal Open Market Committee (FOMC) meeting this week, said an analyst.

At 6pm, the local note traded higher to 4.1110/1160 versus the US dollar from 4.1160/1200 at Friday’s close.

An analyst said the US FOMC is scheduled to meet on Tuesday and Wednesday, with expectations that the US central bank will revise up its gross domestic product (GDP) forecast, following a US$1.9 trillion fiscal stimulus package.

Meanwhile, FXTM’s chief market strategist (Gulf & MENA) Hussein Sayed said despite the rosier economic outlook, this week’s US Federal Reserve (Fed) meeting is expected to be absent of major policy changes.

Nevertheless, he said, how officials see the economy and rates heading over the upcoming years is crucial for investors’ decision making.

“A lot has changed since December when the Fed last updated its economic projections. GDP was estimated to grow by 4.2 percent and unemployment to decline to 5.0 percent by year-end. Expect these forecasts to significantly change on Wednesday when the new forecasts are released.

“While these upgrades should be positive to risk sentiment, it is the inflation forecast that matters most to investors at this stage,” he said in a research note today.

Meanwhile, the ringgit was traded mixed against other major currencies.

It depreciated against the Singapore dollar to 3.0558/0602 from 3.0557/0593 on Friday, but rose against the Japanese yen at 3.7678/7727 from 3.7720/7760.

The ringgit slipped against the British pound to 5.7274/7361 from 5.7262/7326 but improved versus the euro to 4.9028/9106 from 4.9050/9106 previously. — Bernama

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