Will the ringgit breach the 4.70 mark against the US dollar soon?

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The Ringgit May Weaken Past the 4.70 Mark Against the US Dollar

The ringgit closed at 4.7375/7400 against the US dollar on May 7, with analysts suggesting a potential breach of the 4.70 level. This outlook is influenced by upcoming US economic survey data indicating a slowdown in job growth and expectations of US Federal Reserve rate cuts in September.
Anticipated US Economic Weakness

Upcoming US economic survey data is expected to reveal further weaknesses in job growth. This projected slowdown in the labour market could lead to a reduction in the value of the US dollar. Stephen Innes, managing director of SPI Asset Management, indicated that such data might cause the dollar to lose ground against the ringgit, potentially pushing it below the 4.70 threshold.
Prospects of US Interest Rate Cuts

The prospect of US Federal Reserve rate cuts in September is a significant factor supporting the ringgit's potential appreciation. Fed chair Jerome Powell has indicated a stance against further US rate hikes, even amidst persistent inflationary pressures. The current trend of declining US Treasury yields, with the 10-year note trading at 4.46 per cent, reflects market expectations of future monetary easing. Lower interest rates in the US generally make the dollar less attractive to investors seeking higher yields, potentially benefiting currencies like the ringgit.
Ringgit's Performance Against Other Currencies

On May 7, the ringgit demonstrated strength not only against the US dollar but also against a basket of major and regional currencies. It strengthened against the Japanese yen, British pound, and euro. Domestically, the ringgit appreciated against the Thai baht, Singapore dollar, Indonesian rupiah, and Philippine peso, indicating a broader positive trend for the Malaysian currency in the immediate trading period.

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Will the ringgit breach the 4.70 mark against the US dollar soon?

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