Tight range expected amid data lull; profit-taking may trigger correction
The ringgit strengthened to below the 4.70/USD level for the first time since mid-March. This upturn is primarily attributed to the depreciation of the USD index and a downturn in the 10-year US Treasury yield. Despite an unexpected rise in the PPI reading, the market responded with optimism amid disinflationary prospects. The weakening of the DXY can be largely attributed to the slowdown in core CPI, weak retail sales reading and perceived dovish tone of Fed Chair Powell's remarks. Additionally, news of Chinese cities ramping up policy efforts to bolster the housing sector has further bolstered the ringgit's position.
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