KUALA LUMPUR, Jan 4 — The ringgit is expected to trade on a softer note against the US dollar, remaining within a narrow range next week.

UOB Kay Hian Wealth Advisors head of investment research Mohd Sedek Jantan said the United States economic data, particularly jobless claims, are anticipated to show continued improvement after the weekly jobless claims last week dropped by 9,000 to 211,000, which is an eight-month low.

“For January, we expect the US dollar to remain strong, supported by market optimism surrounding the return of Donald Trump to the White House,” he told Bernama.

Mohd Sedek also said the ringgit’s depreciation may be cushioned by increased foreign funds inflows into Malaysia’s capital markets.

“With Wall Street reaching record highs, portfolio rebalancing towards emerging markets is likely to provide some relief for the ringgit,” he noted.

Meanwhile, Kenanga Investment Bank Bhd said the local note faces pressure as the greenback strengthens amid US optimism and Trump’s resurgence.

“While Malaysia’s macroeconomic fundamentals remain solid, robust US data and investor caution over Trump’s resurgence may sustain demand for safe-haven assets, pressuring the ringgit to trade above 4.50/USD,” it said in a research note.

Next week, traders will gear up for the US job openings data, the US Federal Reserve’s (Fed) December Federal Open Market Committee meeting minutes, the ADP employment report, and the US employment report, which are pivotal in shaping expectations for the 2025 interest rate outlook.

Throughout the week, the ringgit was mostly lower on rising demand for the safe-haven currency amid ongoing global economic uncertainties, concerns over the US Fed’s potential decision to cut interest rates in 2025 and robust US jobs data.

On a Friday-to-Friday basis, the ringgit depreciated against the US dollar to 4.4975/5030 from 4.4680/4750 a week ago.

For the week, the local note traded mostly higher against other major currencies.

It gained versus the British pound to 5.5800/5869 versus 5.5904/5991 previously and rose against the euro to 4.6288/6345 from 4.6543/6616.

However, it decreased vis-a-vis the Japanese yen to 2.8606/8643 from 2.8300/8346 at last week’s close.

The ringgit traded mixed against ASEAN currencies, strengthening against the Singapore dollar to 3.2828/2871 from 3.2846/2900 and against the Thai baht to 13.0540/0753 from 13.1023/1289.

It eased against the Indonesian rupiah to 277.6/278.1 from 275.4/276.1 and fell against the Philippine peso to 7.73/7.74 from 7.72/7.74 last week. — Bernama