PETALING JAYA: The ringgit is expected to trade in a tight range with downside bias at between 4.18 and 4.19 against the US dollar this week.

       The local unit will largely be US dollar-driven as the market continues to digest domestic and global economic data.

       Bank Islam Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said the ringgit moved in a narrow range last week and the trend is expected to continue despite the better-than-expected gross domestic product performance in the fourth quarter of 2021, which came in at 3.6% versus consensus estimates of 3.1%.

       Meanwhile, the US consumer price index which stood at 7.5% year-on-year in January against the consensus estimate of 7.3% has bolstered the case for a hike in the US Fed Funds Rate in the upcoming Federal Open Market Committee (FOMC) meeting on March 15-16, he said.

       “Foreign exchange players will continue to zoom in on the US economic data and statements by the Federal Reserve (Fed) officials in order to gain further insight on what may happen at the next FOMC meeting for clues of the market direction.

       “It is a foregone conclusion that the first rate lift off will happen in March. Now its the question of quantum of the hike whereby 50-basis point increase seems to be an appropriate number,” he told Bernama.

       Meanwhile, Hong Leong Bank Bhd, in a research note said for the week just-ended, the greenback traded sideways against the ringgit in a comparatively uneventful week, after having moved within 4.1765 to 4.1905 in the past five trading sessions.