The ringgit is expected to be on a downtrend next week against the US dollar as investors gained confidence in the greenback after the release of strong US economic data.

The positive data signaled a possible hike in interest rates in September.

Affin Hwang Investment Bank Vice-President and Head of Retail Research Datuk Dr Nazri Khan Adam Khan said he expected the local note's depreciation to encourage more medium term investments particularly in foreign direct investments (FDI) and bond portfolios.

"Last week the ringgit continued to weaken one per cent against the US dollar at 3.7610 while compared with the Singapore dollar it was down 1.5 per cent to 2.8005.

"It is likely that new investors will grab the temporary opportunity in the undervalued weaker ringgit as it offered a cheap entrance point to the medium to long-term FDI and bond market," he added.

On a Friday-to-Friday basis, the ringgit weakened to 3.7660/7690 against the US dollar from 3.7430/7460 last Friday.

Against other major currencies, the ringgit was traded mixed.

It fell versus the Singapore dollar to 2.7996/7020 from 2.7985/8018 and depreciated against the yen to 3.0516/0543 from 3.0428/0460 previously.

Meanwhile, against the British pound, the local currency rose to 5.9318/9369 from 5.9327/9385 and strengthened against the euro to 4.2194/2235 from 4.2345/2382 last Friday.