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0520 GMT – The ringgit may trade in a tight range against the greenback next week, as investor bets on a 25bp rate hike by the Fed support USD, despite the USD Index trending lower, Kenanga Investment Bank economists say in a note. China 1Q GDP data due next week could also have an impact on the Malaysian currency’s direction, they say. A positive result could boost MYR, given Malaysia’s trade ties to China. Technical analysis suggests a neutral outlook for USD/MYR next week, with the pair likely hovering around 4.405, they add. Kenanga forecasts USD/MYR at 4.351 at end-2Q, 4.204 in 3Q and 4.107 in 4Q, pegging short-term resistance at 4.413 and support at 4.389. USD/MYR falls 0.2% at 4.3900. (yingxian.wong@wsj.com)
SGD Weakens Vs. USD After MAS’s Surprise Move to Leave Policy Unchanged
0512 GMT – SGD weakens against the USD in the afternoon Asian session after the Monetary Authority of Singapore’s surprise move to leave monetary policy unchanged. The overall statement leans dovish, Maybank analysts say in a FX Research & Strategy report. Given the MAS’s “sufficiently tight” language used in the statement, the central bank is likely biased toward standing pat in October as well, as long as its expected trajectory for core inflation holds, the analysts add. The MAS’s monetary policy is centered on Singapore’s exchange rate, which it considers an effective tool for maintaining price stability in the small and open economy. USD/SGD is up 0.2% at 1.3247. (ronnie.harui@wsj.com)
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