KUALA LUMPUR: The ringgit continued to strengthen against the US dollar on Tuesday, hovering towards the RM4.05 level at the close after opening at RM4.06, as the constant attack by the Trump administration against the Federal Reserve (Fed) hurt market confidence and weakened the greenback.
At 6 pm, the local currency rose to 4.0555/0600 versus the US dollar from Monday’s close of 4.0605/0660.
Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said it remains uncertain who will succeed Fed chair Jerome Powell by the middle of this year, with expectations that the new chairman could be dovish in his assessment of the state of the economy.
"By extension, this would translate into a lower Federal Funds Rate this year,” he told Bernama.
On the local front, Mohd Afzanizam said the upcoming Malaysia’s fourth quarter of 2025 (4Q 2025) gross domestic product (GDP) estimate, which will be released on Friday, seems to be contributing to the constructive view on the ringgit.
"Consensus estimate has pegged the advance GDP estimate to be at 5.4 per cent, which is well above the 5.2 per cent growth in the prior quarter. If materialised, the 2025 GDP growth could be slightly above the top range of the government forecast (4.0 per cent to 4.8 per cent),” he added.
At the close, the ringgit traded mostly higher against a basket of major currencies.
It appreciated versus the Japanese yen to 2.5521/5551 from 2.5717/5754 at yesterday’s close and strengthened vis-à-vis the euro to 4.7344/7396 from 4.7435/7499 on Monday, but it edged down against the British pound to 5.4676/4737 from 5.4630/4704.
The local note performed better against its ASEAN peers.
The ringgit was higher versus the Singapore dollar at 3.1511/1549 from 3.1567/1613 at Monday’s close, gained vis-à-vis the Indonesian rupiah to 240.3/240.6 from 240.9/241.3 yesterday, advanced against the Philippine peso to 6.83/6.84 from 6.85/6.86, and improved versus the Thai baht to 12.8840/12.9036 from 12.9961/13.0195 previously. - Bernama
