Kuala lumpur: The ringgit is expected to trade firmer and remain around the 3.90 level against the US dollar next week, supported by the strong domestic economic growth momentum that continues to influence market sentiment.
According to BERNAMA News Agency, Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid noted that the local currency is currently hovering around RM3.90 against the US dollar but could test its immediate resistance level of RM3.87 next week. He stated that traders' sentiment would be shaped by the strong growth euphoria, benefiting the ringgit in the near term.
Kenanga Investment Bank Bhd (Kenanga IB) highlighted that the weakness of the greenback remained the primary driver of the ringgit gains. It observed that the US Dollar Index (DXY) slipped below 97.0 as markets favored selling rallies rather than extending them. The bank indicated that investors would focus on US inflation cross-checks and parse the US Federal Open Market Committee (FOMC) minutes for signals on labor cooling, with inflation numbers remaining pivotal for rate repricing.
Kenanga IB further noted that solid US data no longer guarantees sustained US dollar strength. Strategic diversification flows and recalibrated growth expectations have increased the market's tendency to monetize rallies. For the ringgit, the external US dollar path remains dominant while domestic stability plays a supporting role. A sustained US dollar recovery would require firmer inflation and higher real yields.
Bank Negara Malaysia previously reported that the local currency rose 3.9 percent against the greenback in the fourth quarter of 2025, driven by both external and domestic factors. On Thursday, the local currency touched 3.8995 against the greenback, hovering near its strongest level in almost eight years, last seen on April 23, 2018, at 3.8965/8995.
On a week-on-week basis, the ringgit ended the week firmer against the US dollar to close at 3.9060/9115 compared with 3.9440/9525 last Friday. The local note traded mostly higher against a basket of major currencies this week.
The ringgit fell against the Japanese yen to 2.5435/5474 from 2.5111/5167, but appreciated vis- -vis the British pound to 5.3211/3286 from 5.3548/3663 and rose versus the euro to 4.6325/6390 from 4.6508/6608 a week earlier. Compared with its ASEAN peers, the ringgit traded mostly higher, rising against the Singapore dollar, the Indonesian rupiah, and the Philippine peso. However, it edged down against the Thai baht to 12.5607/5849 from 12.4609/4933.