Kuala lumpur: The ringgit opened marginally higher against the greenback and other major currencies on Tuesday, amid negotiations between the United States (US) and Iran that could end the conflict and lead to the reopening of the Straits of Hormuz. At 8 am, the local currency strengthened to 3.9500/9560 against the greenback from Monday's close of 3.9510/9550. US President Donald Trump reportedly said the negotiations are "proceeding nicely", while Pakistan's military chief informed China that an agreement is "close to being reached".

According to BERNAMA News Agency, Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid noted that although there appears to be optimism about both countries reaching a compromise, nothing concrete has yet materialised. Dr Mohd Afzanizam highlighted the ongoing impact on the cost of living and the need for global central banks to maintain a restrictive monetary policy, which is affecting the bond market through rising yields.

He further explained that the overall outlook remains uncertain, leading traders to remain cautious about the potential impact on the real economy. He anticipated that the ringgit would likely trade sideways around RM3.94-RM3.95 as market participants await further details on the US-Iran negotiations.

At the opening, the ringgit showed gains against a basket of major currencies. It strengthened against the Japanese yen to 2.4847/4887 from 2.4860/4887 at Monday's close, appreciated against the euro to 4.5958/6028 from 4.5998/6044, and improved against the British pound to 5.3301/3382 from 5.3311/3365 previously.

The local currency saw mixed performances against regional peers. It remained unchanged versus the Indonesian rupiah at 222.6/223.0, while it rose against the Singapore dollar to 3.0917/0967 from 3.0932/0966. It also edged higher against the Philippine peso to 6.42/6.44 from 6.43/6.44 and increased against the Thai baht to 12.1445/1704 from 12.1640/1816 at Monday's close.