KUALA LUMPUR: The ringgit breached the RM4 threshold to hit a fresh five-year high as traders assessed strong economic growth and an otherwise upbeat annual outlook.
The local currency was traded at 3.9992 against the US dollar at 2.19pm. Year-to-date, the ringgit has appreciated about 1.5%.
On Thursday, Bank Negara Malaysia kept the Overnight Policy Rate (OPR) unchanged at 2.75%, the level it was reduced to in July 2025, in line with market expectations.
The central bank said that at the current OPR level, the Monetary Policy Committee (MPC) considers the monetary policy stance to be appropriate and supportive of the economy, amid price stability.
Kenanga Research said the ringgit drew support from a softer US dollar and Bank Negara’s decision to keep policy unchanged.
It noted that the US dollar index fell below 99.0, pressured by spillovers from heightened volatility in Japanese government bonds (JGBs) and concerns that European investors may reduce their holdings of US Treasuries (UST).
“Fresh fiscal giveaways proposed by Prime Minister Takaichi triggered a further sell-off in JGBs, amplifying global bond market jitters. Risk assets found additional support on Thursday after a framework agreement on Greenland led Trump to abandon plans for new tariffs on the EU,” it said.
Meanwhile, Bernama reported that Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said the MPC’s decision reinforced expectations of policy stability, which has helped support the local currency.
He added that market sentiment has also improved after United States President Donald Trump softened his stance on Greenland.
Malaysia's economy is projected to have grown 5.7% in the fourth quarter of 2025, according to the advance estimate issued by the National Statistics Department ahead of the release of the actual gross domestic product (GDP) next month.
Annually, Malaysia's economic growth in 2025 eased to 4.9% from 5.1% in 2024.
