Kuala lumpur: The ringgit opened higher against the US dollar and other major currencies on Wednesday, as risk sentiment improved following potential ceasefire talks between the United States and Iran. At 8 am, the local currency strengthened to 3.9400/9500 against the greenback from Tuesday's close of 3.9530/9585.
According to BERNAMA News Agency, SPI Asset Management managing partner Stephen Innes noted that the ringgit is likely to trend more positively if the ceasefire narrative continues, indicating a shift by Washington from tactical de-escalation to more serious dialogue with Tehran. However, the situation remains uncertain, with President Donald Trump reinforcing military presence in the region, leaving questions about Iran's full engagement.
Innes explained that the market is currently driven by headlines and reactive positioning, rather than strong convictions. While the promise of peace may be factored into market pricing, a tangible ceasefire agreement is necessary for a sustained rally.
Meanwhile, Bank Muamalat Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid stated that developments in West Asia remain a focal point as the conflict in Iran progresses into its fourth week. Despite mixed signals from Washington regarding the end of the war, troop deployments to the region continue.
Mohd Afzanizam highlighted the economic impact of the ongoing war, noting that skyrocketing fuel prices have led to inflationary pressures, affecting consumer purchasing power and personal budgeting. He also pointed to weak survey indicators, such as the Purchasing Managers' Index (PMI) for March 2026, particularly in service-oriented industries.
The economist noted that the services PMI index for Australia fell to 46.6 points in March from 52.8, with similar declines in Japan, India, France, Germany, the United Kingdom, and the US. Additionally, the US Dollar Index (DXY) remained below 100 points, at 99.43, as concerns about the war's duration and its impact on global growth and inflation persisted.
The ringgit also opened higher against a basket of other major currencies, rising against the Japanese yen, British pound, euro, and various ASEAN currencies, including the Singapore dollar, Thai baht, Indonesian rupiah, and Philippine peso.