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Wednesday, January 16, 2013

Ringgit Expected To Appreciate In 2013

5 Rabiulawal 1434

KUALA LUMPUR, Jan 16 , 2013- The ringgit is anticipated to move between RM2.95 and RM3.15 to the US dollar in 2013, in line with Malaysia's potential economic growth for the year.

MIDF Amanah Investment Bank Bhd Chief Economist Anthony Dass said the ringgit is expected to average 3.05 against the US dollar for the year, as economic growth is likely to expand to 5.8 per cent compared to 5.3 per cent in 2012.

He added that the overnight policy rate (OPR) is also likely to remain stable this year.

"The Yen is expected to weaken further in view of the recent stimulus measures taken by the Japanese government," he told Bernama.

The Japanese government has unveiled a 10.3 trillion yen stimulus package that will lift its gross domestic product by two per cent and create 600,000 new jobs.

Currency movements are determined by several elements, including economic and political developments.

Meanwhile, Malaysian Rating Corporation Bhd Chief Economist Nor Zahidi Alias said the ringgit would likely hover between RM2.95 and RM3.15 against the US dollar in 2013, on the assumption that political stability reigns throughout the year.

However, Nor Zahidi did not discount the possibility of the ringgit moving in a wider range to the greenback, should market sentiment turn volatile before or after the general election.

"Under such circumstances, the ringgit's downside risk may be more than our base case scenario of RM3.15 against the US dollar," he said.

On the domestic front, Nor Zahidi said several factors would likely determine the ringgit's movement to the US dollar.

"These include growth momentum and the sustainability of the current account surplus, as well as the trend in the fiscal deficit, which would be closely monitored by international investors," he added.

More information: BERNAMA