Ringgit Rally Fades: Profit-Taking Looms Ahead of Fed Meeting
The ringgit has been on a strong run over the past six trading days, but market analysts at Kenanga Investment Bank Bhd (Kenanga IB) believe that profit-taking may be imminent next week.
The local currency ended the week at 4.0365/0405 against the US dollar, with a rally of about 0.7% from its previous value of 4.0840/0885.
Kenanga IB notes that the ringgit's sharp rally and oversold conditions this week leave room for profit-taking if US Federal Reserve (Fed) chair Kevin Warsh delivers less dovish guidance at the Jackson Hole Symposium on August 27-29.
The analysts also point out that investors will be watching for clues on the Fed's policy decision at the upcoming Federal Open Market Committee (FOMC) meeting on September 15-16, which may have a significant impact on the ringgit's value.