OctaFX: August inflation data may give more power to the ringgit
- Written by Viw Magazine
Malaysia's sharp decline in inflation is likely to stop: August figures will likely remain at 2.0%. Against the backdrop of monetary policy easing, this may support the ringgit. Kar Yong Ang, the OctaFX financial market analyst, shares his opinion.
- Inflation in Malaysia slowed to 2.0% in July. Annual consumer inflation is expected to remain unchanged in August.
- Due to economic growth and easing inflation, Malaysia's central bank kept its benchmark interest rate unchanged at the last meeting.
- In the current economic conditions, USDMYR will decline towards 4.520 and possibly lower.
According to official data released last month, Malaysia's annual inflation rate slowed to 2.0% in July from 2.4% in June. Lower inflation rates were recorded in Food and non-alcoholic beverages (4.4% in July from 4.7% in June) and Restaurants and hotels (5.0% in July from 5.4% in June). Overall, Malaysia's inflation rate of 2.0% was lower than that of neighbouring regions, with July inflation in Indonesia, the Philippines, and Singapore standing at 3.1%, 4.7%, and 4.1%, respectively.
The Central Bank of Malaysia is satisfied with the reduction in inflation and kept its benchmark interest rate unchanged at the last monetary policy meeting as economic growth and inflation continued to ease.
'We see the continued growth of the Malaysian economy,' said Kar Yong Ang. 'With low consumer inflation and a signal from Malaysia's central bank that the ringgit continues to demonstrate its strength, we tend to assume that USDMYR will decline towards 4.520 and possibly lower,' he added.
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OctaFX is an international broker that has been providing online trading services worldwide since 2011. It offers commission-free access to financial markets and various services already utilised by clients from 180 countries who have opened more than 42 million trading accounts. Free educational webinars, articles, and analytical tools they provide help clients reach their investment goals.
The company is involved in a comprehensive network of charitable and humanitarian initiatives, including the improvement of educational infrastructure and short-notice relief projects supporting local communities.
In the APAC region, OctaFX captured the ‘Best Forex Broker Malaysia 2022’ and the ‘Best Global Broker Asia 2022’ awards from Global Banking and Finance Review and International Business Magazine, respectively.
