Kuala lumpur: The ringgit is anticipated to trade within a narrow range against the US dollar next week as investors maintain a cautious approach ahead of Bank Negara Malaysia's Monetary Policy Committee (MPC) meeting scheduled for January 22.

According to BERNAMA News Agency, Bank Muamalat Malaysia Bhd's chief economist, Dr Mohd Afzanizam Abdul Rashid, indicated that traders are closely monitoring the central bank's decision, with expectations that the overnight policy rate (OPR) will remain unchanged at 2.75 percent. The decision is likely influenced by Malaysia's commendable growth trajectory and low inflation rate. Dr Mohd Afzanizam suggested that, under these conditions, the ringgit would fluctuate between RM4.05 and RM4.06 against the US dollar next week.

Kenanga Investment Bank Bhd also provided insights, predicting the ringgit to trade within the 4.05-4.08 range. The bank noted that ongoing concerns about the US Federal Reserve's independence could impact the American dollar, though seasonal factors and strong US economic data might offer some stability to the Dollar Index. The investment bank also mentioned that if the investigation into Fed Chairman Jerome Powell is concluded without further action, the US dollar might experience a rebound.

The ringgit concluded the week slightly lower against the US dollar but showed a week-on-week strengthening, closing at 4.0555/0605 compared to 4.0700/0765 the previous Friday. It demonstrated gains against a selection of major currencies, including the Japanese yen, euro, and British pound, while also appreciating against several ASEAN currencies such as the Indonesian rupiah, Philippine peso, Thai baht, and Singapore dollar.