KUALA LUMPUR, Nov 5 (Bernama) -- Bursa Malaysia closed higher, buoyed by Bank Negara Malaysia’s (BNM) decision to maintain the Overnight Policy Rate (OPR) at 2.75 per cent, alongside positive cues from Wall Street. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) rose 19.30 points, or 1.19 per cent, to 1,635.86 from Wednesday’s close of 1,616.56. The benchmark index opened 6.72 points higher at 1,623.28, and fluctuated between an intraday high of 1,642.44 and a low of 1,622.62 during the trading session. However, market breadth was negative, with losers outnumbering gainers 723 to 497, while 466 counters were unchanged, 1,075 untraded and 10 suspended. Turnover rose to 3.74 billion units valued at RM3.61 billion compared with yesterday’s 2.81 billion units valued at RM2.57 billion.
The ringgit is forecast to remain under pressure against the US dollar in the near term, driven by the Federal Reserve’s less dovish monetary stance, according to Kenanga Research.
Key Projections
- Exchange Rate: The ringgit is expected to stay above 4.50 against the US dollar going into 2025.
- Recent Performance: The ringgit, which had gained 15% against the dollar between January and September, has since retreated amid the strength of the US economy. It last traded at 4.5060, up 1.88% year-to-date.
Factors Influencing the Ringgit
- US Economic Strength: Strong domestic demand and inflationary pressures are propping up the dollar.
- Fed’s Monetary Policy: The Fed’s cautious approach to rate cuts bolsters the dollar’s appeal, with markets anticipating only one rate cut in 2025.
- Trump’s Policies: Uncertainty around policies under the incoming US administration may lead the Fed to delay cuts further.
Outlook for 2025
- Kenanga projects two to three Fed rate cuts in 2025, which could provide relief for the ringgit in the latter half of the year.
- In Malaysia, Bank Negara’s overnight policy rate is expected to remain steady at 3% through 2025.
Comments
Post a Comment