KUALA LUMPUR: The ringgit extended its gains against the US dollar at Wednesday’s close, lifted by the latest fiscal support measures announced by the government as foreign funds flocked into the local equity market, said an analyst.
The local currency was also supported by optimism following the US-Japan trade deal which boosted Asian equity and foreign exchange markets across the board.
At 6 pm, the ringgit rose to 4.2255/2300 versus the greenback compared with Tuesday’s close of 4.2300/2370.
Earlier today, Prime Minister Datuk Seri Anwar Ibrahim unveiled a new round of fiscal support measures aimed at alleviating living costs, stimulating domestic consumption and boosting household spending ahead of the upcoming National Day and Malaysia Day celebrations.
Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the one-off RM100 cash aid for Malaysians aged 18 and above, given through MyKad under the RM2 billion Sumbangan Asas Rahmah (SARA) programme, would help support economic growth in the second half of 2025.
"In a way, it’s like a mini fiscal stimulus at a time when external uncertainties have become apparent. Such proactive move bodes well for the ringgit in the near term,” he told Bernama.
Meanwhile, SPI Asset Management managing partner Stephen Innes said the ringgit was supported by regional tailwinds after US President Donald Trump struck a "massive” trade deal with Japan on Tuesday, which included cutting US tariff on the latter to 15 per cent from 25 per cent.
Innes noted that the deal has boosted market optimism which lifted stocks and Asian currencies including the ringgit.
"There is growing speculation that if Japan could secure softer terms, Malaysia might also seek similar concessions before the Aug 1 deadline,” he added.
However, the ringgit was weaker against a basket of other major currencies at the close.
It slipped versus the Japanese yen to 2.8837/8870 from 2.8690/8739 at Tuesday’s close, weakened vis-a-vis the British pound to 5.7230/7291 from 5.7088/7183 yesterday, and fell versus the euro to 4.9586/9639 from 4.9512/9594.
The local note was also easier against some regional peers.
It was flat against the Indonesian rupiah at 259.1/259.5 compared with 259.1/259.7 at yesterday’s close.
However, it slid vis-à-vis the Singapore dollar to 3.3071/3109 from 3.3011/3071 on Tuesday, depreciated versus the Thai baht to 13.1370/1567 from 13.0899/1172 previously, and inched down against the Philippine peso to 7.42/7.44 from 7.41/7.43. - Bernama
