Ringgit likely to stay steady next week

The ringgit is likely to remain steady next week supported by what dealers say is a business-friendly budget for 2012 unveiled by Prime Minister Datuk Seri Najib Tun Razak on Friday.

Concerns over global economic developments, however, may keep the ringgit movement within tight ranges.

Hong Leong Bank said the federal government budget whose aims are to tackle rising cost of living, promote growth and cut the deficit to below five per cent, would be positive for the ringgit in the short term.

It said the ringgit would see more upward pressure in the following week as the 2012 Budget was expected to spur more investor interest in the domestic market, in particular with regard to the financial sector improvement initiatives, which were given specific mention.

"Volatility in the US dollar against the ringgit is expected to increase going forward following the tabling of the Malaysian 2012 Budget and heightened expectations of a general election announcement soon.

"Apart from that, we expect players to stay on edge with external developments. The worsening global economy as well as the European turmoil will continue to supply a bid," it added.

This week, the ringgit strengthened against the US dollar to 3.1570/1601 from 3.1870/1910.

It also improved against the Singapore dollar to 2.4373/4406 from 2.4549/4591, appreciated against the yen to 4.1166/1228 from 4.1470/1528, rose against the British pound to 4.8978/9038 from 4.9724/9789 and gained against the euro to 4.2399/2446 from 4.3142/3213. -- Bernama