Ringgit likely to move sideways against USD

The ringgit is expected to trade cautiously against the US dollar next week amid concerns over Europe's debt crisis and the increased risk of a global recession, dealers said.

The local unit will likely move sideways around the 3.17 and 3.18 levels against the US dollar with investors getting increasingly frustrated over the European Union's (EU) slow action to tackle the crisis.

"The eurozone debt crisis keeps markets volatile and gives a major impact on market sentiments globally in the near term," a dealer said.

Risk sensitive ringgit and regional currencies which were under pressure for the last two weeks, would definitely see an increase in volatility arising from the eurozone uncertainties, the dealer said.

"But, the ringgit may rebound if the EU leaders come up with concrete solutions and provide more liquidity to the financial market and contain the crisis."

This week, the ringgit was on a downward trend against the US dollar due to risk aversion.

On a Friday-to-Friday basis, it was lower against the dollar 3.1470/1510 compared with 3.1260/1290 last week.

It strengthened against the Singapore dollar to 2.4193/4242 from 2.4338/4381 previously but fell against the yen to 4.0486/0559, from 4.0170/0229.

Against the British pound, the ringgit was lower at 4.9172/9244 from 4.9053/9110 previously but strengthened against the euro to 4.1975/1034 from 4.2117/2163. -- Bernama