Maybank Asset Management feels that the Malaysian Ringgit and other currencies’ weakness against the US Dollar is a temporary trend. Once the US turns towards interest rate cuts, the US Dollar is projected to decline, perhaps contributing to a recovery in Ringgit valuation.
Maybank Asset Management’s Chief Investment Officer, Syhiful Zamri, admitted that the Ringgit has been one of the worst-performing ASEAN currencies. However, he feels that this is only a temporary performance, owing to current commodity price weakness and the interest rate gap between Malaysia and the US, which supports the US Dollar’s gain.
During a news conference, he stated that Malaysia is a big oil exporter when compared to other ASEAN countries that are net oil importers. As a result, an increase in oil prices would benefit the Ringgit’s performance, and vice versa. However, he warned that factors such as Malaysia’s economic stability and the uncertainties surrounding state elections could have an impact on the exchange rate.
Syhiful Zamri made these remarks after attending the launch of Maybank Asset Management’s MAMG Global Dividend Fund.
In terms of interest rate modifications, most regional countries, notably Malaysia and Indonesia, have already reverted to pre-pandemic levels with their overnight policy rates (OPR).
The Ringgit’s exchange rate versus the US Dollar is predicted to be approximately 4.5 Ringgit to 1 US Dollar by the end of this year, fluctuating between 4.20 Ringgit and 4.40 Ringgit in the first half of next year.
When asked about the potential of the Ringgit falling versus the Singapore Dollar again, Syhiful Zamri responded that the Singapore Dollar moves in lockstep with the performance of the US Dollar, and the US Dollar benefits from local rate hike activities. As a result, the Ringgit remains vulnerable to short-term risks against the Singapore Dollar.
Concerning Bank Negara Malaysia’s action to strengthen the Ringgit, Syhiful Zamri feels the central bank is hesitant to intervene. Bank Negara does not use an exchange rate level as a criterion for interfering unless there is quick and considerable volatility in the Ringgit exchange rate, such as a sharp depreciation from 4.67 Ringgit to 1 US Dollar to 4.80 Ringgit to 1 US Dollar.
Maybank Asset Management and J.P. Morgan Asset Management announced the creation of the MAMG Global Dividend Fund, which seeks capital and profit growth by investing in the JPMorgan Investment Funds – Global Dividend Fund managed by J.P. Morgan Asset Management (Europe). The fund primarily invests in high-quality global stocks, particularly high dividend yield and dividend growth stocks, with the goal of generating consistent income and potentially growing wealth.
