Thursday 28 Mar 2024
By
main news image

KUALA LUMPUR (Aug 15): Standard Chartered said the ringgit was still undervalued, despite its earlier-than-expected rally. The research firm said the ringgit might reach its fair value at 4.10 against the US dollar by end 2017 and hover at that level until mid-2018, following the decent rally.

Standard Chartered foreign exchange (FX) strategist Divya Devesh said while the ringgit had seen a decent rally earlier than expected, Standard Chartered remained "overweight" on the currency. He said the ringgit was still one of the most undervalued among emerging market currencies.

At 12:12pm today, the ringgit was traded at 4.2935 against the US dollar. Over the last one year, the exchange rate was between 3.9833 and 4.5002.

Devesh was speaking to reporters here today at Standard Chartered's briefing on Malaysia's second half 2017 (2H17) economic and FX outlook.

At the briefing, Standard Chartered regional research head for Southeast Asia, Edward Lee, said Malaysia's 2Q17 gross domestic product (GDP) could have grown 5.4% from a year earlier, after what appeared to be strong growth in private consumption and investment.

Bank Negara Malaysia is scheduled to announce the nation's 2Q17 GDP numbers this Friday (Aug 18). Today, Lee said if the actual numbers meet Standard Chartered's forecast, it would pose significant "upside risk" to Standard Chartered's full year GDP projection at 4.6%. 

He said Standard Chartered had in April this year, revised upward the full-year GDP forecast from 4.1%.

"Private consumption and private investment have surprised us so far this year," Lee said.

According to Bank Negara, the Malaysian economy expanded 5.6% in 1Q17 from a year earlier. In 2016, the country's GDP grew 4.2% from a year earlier, the central bank said.

      Print
      Text Size
      Share