Kuala lumpur: The ringgit closed almost unchanged against the US dollar ahead of Malaysia's gross domestic product (GDP) announcement for the second quarter tomorrow, as investors adopted a wait-and-see approach after US inflation data came in within expectations, supporting the greenback. At 6 pm, the ringgit eased to 4.0850/0890 versus the US dollar from Wednesday's close of 4.0835/0875.
According to BERNAMA News Agency, Bank Muamalat Malaysia Bhd chief economist Dr. Mohd Afzanizam Abdul Rashid noted that the market was taking a cautious stance ahead of tomorrow's announcements by Bank Negara Malaysia and the Department of Statistics Malaysia concerning the country's economic performance. Malaysia's advance GDP estimate for 2Q 2026 expanded by 5.8 percent year-on-year, accelerating from the first quarter's 5.4 percent growth.
Dr. Mohd Afzanizam expressed optimism, suggesting that the GDP figures are likely to meet or exceed expectations based on positive indicators such as the Industrial Production Index (IPI) and Malaysia's services activity. The IPI rose by 6.5 percent year-on-year in June 2026, maintaining positive momentum across all sectors. Additionally, Malaysia's services activity, measured by the sector's volume index, increased by 5.9 percent year-on-year in the second quarter, driven by stronger wholesale and retail trade, food and beverage, and accommodation activities, as previously reported by the Department of Statistics Malaysia (DOSM).
On the US dollar's performance, Dr. Mohd Afzanizam highlighted that the slight moderation in the US inflation rate to 3.4 percent suggested that an interest rate hike decision at the upcoming Federal Open Market Committee's September meeting was uncertain. The recent US Consumer Price Index (CPI) data indicated the possibility of maintaining the current interest rate, affecting the interest rate differential between the US and Malaysia's overnight policy rate, which could influence investor decisions.
Meanwhile, at the close, the local currency ended mostly higher against a basket of major currencies. It climbed against the Japanese yen to 2.5634/5660 from 2.5655/5682 at Wednesday's close and improved vis- -vis the British pound to 5.5119/5173 from 5.5180/5234 previously. However, it fell against the euro to 4.7120/7167 from 4.7107/7153.
The local note traded mixed against regional currencies. It was marginally higher against the Philippine peso to 6.66/6.67 from 6.67/6.68 and edged up against the Thai baht to 12.3239/3412 from 12.3488/3665. Against the Indonesian rupiah, it remained unchanged at 228.4/228.8 from 228.4/228.7 registered at yesterday's close, while against the Singapore dollar, the local note declined to 3.1912/1945 from 3.1905/1941 on Wednesday.