KUALA LUMPUR: The ringgit opened marginally higher against the US dollar on Thursday as traders shifted focus to the overnight policy rate (OPR) announcement later in the day, despite the ongoing conflict in the Middle East.
At 8 am, the local currency traded at 3.9340/9450 against the greenback, compared with Wednesday’s close of 3.9395/9465.
Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said Bank Negara Malaysia is widely expected to keep the OPR unchanged, with markets focused on the central bank’s assessment of recent geopolitical developments in the Middle East.
"Markets will be watching the OPR decision later today. The accompanying statement will set the direction of monetary policy going forward,” he told Bernama.
On the recent surge in global oil prices, Mohd Afzanizam said crude markets remain driven by developments in the Middle East.
He noted that Malaysia’s revenue is now far less dependent on oil, which is projected to contribute about 12.5 per cent in 2026, compared with more than 40 per cent in 2009.
"Malaysia is therefore somewhat insulated from an oil price shock. However, the country imports oil for domestic consumption, while most of its higher-grade crude is exported at better premiums. This could explain why the ringgit remains relatively resilient,” he added.
On Wednesday, the ringgit traded in a tight range of RM3.9378 to RM3.9540 against the US dollar, and he expects similar conditions to persist on Thursday as traders remain in risk-off mode.
At the open, the ringgit was mixed against major currencies.
It was flat against the Japanese yen at 2.5062/5134 from 2.5062/5108 previously, strengthened against the British pound to 5.2594/2741 from 5.2640/2733, but eased versus the euro to 4.5772/5900 from 4.5738/5819.
The local currency was firmer against most ASEAN peers.
It rose against the Singapore dollar to 3.0857/0946 from 3.0864/0921 at Wednesday’s close, gained versus the Thai baht to 12.4494/4925 from 12.5246/5541, appreciated against the Indonesian rupiah to 232.8/233.6 from 233.1/233.7, and edged up against the Philippine peso to 6.71/6.74 from 6.72/6.74. - Bernama
