Kuala Lumpur: The ringgit opened slightly higher against the US dollar today, buoyed by positive sentiment stemming from ongoing US-China diplomatic negotiations concerning US tariffs, as noted by an analyst. At 8 am, the local currency edged up to 4.2950/3170 against the greenback from Friday’s close of 4.2970/3005.

According to BERNAMA News Agency, Bank Muamalat Malaysia Bhd’s chief economist Dr. Mohd Afzanizam Abdul Rashid highlighted that the US Dollar Index (DXY) climbed over one percent to 101.788 points as US-China trade tensions showed signs of easing. This development contributed to a rise in benchmark equities and yields on US Treasury bonds, reflecting a prevalent risk-on sentiment in the market.

Dr. Mohd Afzanizam noted that the ringgit would likely experience range-bound trading as US-China trade agreements indicate that tariff shocks could be more effectively managed through diplomatic negotiations in the coming months. He also mentioned that the 90-day pause in tariff escalations agreed upon by the US and China could lead to more favorable outcomes for various countries, including Malaysia.

Reports indicate that the US and China have agreed to reduce tariffs on each other’s goods for the next 90 days, signaling a potential de-escalation in their ongoing trade war. As part of the agreement reached during weekend negotiations in Geneva, the US will lower its additional tariff on Chinese products from 145 percent to 30 percent, while China will reduce its tariff on American imports from 125 percent to 10 percent.

At the market opening, the ringgit also traded higher against a basket of major currencies and ASEAN countries. It rose against the Japanese yen, euro, and British pound, and strengthened against the Singapore dollar, Indonesian rupiah, Philippine peso, and Thai baht, reflecting a broad-based improvement in its exchange rate.