The ringgit is now the world’s best-performing currency against the US dollar, says Lloyd Chan, a senior analyst with MUFG Bank. Data from Bloomberg shows the ringgit has appreciated 14.35% against the US dollar over the last three months, beating gold, which rose by 14.2%, into second place. The data covered the period between June 27 and Sept 27. Chan attributed the ringgit’s bullish recovery to Malaysia’s economic growth and the US Federal Reserve’s ongoing interest rate easing cycle. Market expectations for more US rate cuts since July have fuelled the ringgit’s sharp rally in the second half of this year. As the ringgit was ‘cheap’ at the end of the first half of the year, it provided scope for the currency’s appreciation, Chan told FMT (Free Malaysia Today). Chan said the Thai baht was also notably strong against the greenback due to the country’s improved outlook for growth, the recovery of its tourism industry, and rising gold prices. The baht came in third with a 13.79% appreciation against the US dollar, followed by the Japanese yen, at 13.04%. Chan said the ringgit could potentially strengthen to a five-year record high of RM4 to the US dollar by year-end provided market sentiments remain positive towards Asian currencies and subject to the US Federal Reserve Board slashing its interest rate by 50 basis points. However, he cautioned that the upcoming US presidential election may bring some degree of volatility into the market. On Sept 27, BMI Country Risk & Industry Research (BMI), a unit of Fitch Solutions, revised the ringgit’s end-2024 forecast to RM4 per US dollar, from RM4.55 previously. Beyond the six-month horizon, BMI forecasts that the ringgit will strengthen by 9% in 2025, potentially reaching RM3.55 per US dollar by end-2025. Bank Muamalat Malaysia Bhd chief economist Afzanizam Abdul Rashid expects demand for the ringgit to remain robust. He said HSBC has become the latest global bank to upgrade Malaysia’s rating from underweight to neutral. This suggests that foreign banks are positive on Malaysia’s economic prospects, Afzanizam told FMT. Earlier this month, Bloomberg reported that the ringgit had its best quarterly performance since 1973. Yesterday, the ringgit closed at RM4.12 to the US dollar — bouncing back from RM4.81 in February 2024, its second lowest valuation since the Asian Financial Crisis in 1997-1998. Analysts suggest the ringgit may extend its rally and strengthen further this year, on the back of narrower interest rate differentials with the US and Malaysia’s improving trade performance. (ICE KUALA LUMPUR)

Fonte notizia: 07 ottobre 2024, Kuala Lumpur