Ringgit Bearish On Various External And Local Factors

KUALA LUMPUR, July 6 (Bernama) -- The ringgit continued to remain bearish as Greece's exit from the eurozone became imminent after the country voted to reject the terms of a bailout. Anticipation of possible interest rate hike in the United States coupled with debate surrounding state investment company 1Malaysia Development Bhd also pressured the local unit downwards, dealers said. The ringgit breached the 3.80 level against the US dollar Monday morning to open at 3.8040/8080. Kenanga Research said the local currency was expected to remain volatile and trade within a broad range of 3.65 and 3.85 in the short-term. A dealer said the ringgit's weakness was also in tandem with most emerging Asian currencies as demand for emerging market assets were dampened by the increasing risk that Greece would exit the eurozone after the country voted to reject the terms of a bailout. "Malaysia was unfortunate for being singled out by fund managers. This has dragged the currency lower of late. "The ringgit not only depreciated sharply against the greenback but also against other regional currencies especially the Singapore dollar,” he added. Meanwhile, Affin Hwang Investment Bank Vice-President and Head of Retail Research Dr Nazri Khan said Malaysia was in a much better position now then it was during the 1998 financial crisis. He said Malaysia’s banking system was now more robust, the country has a lower foreign debt level and the private sectors have already adjusted their dollar debt portfolio. And, Malaysia’s low interest rate would also allow the central bank to take various measures to counter the ringgit's weaknesses, he said. -- BERNAMA