Kuala lumpur: The ringgit closed higher today, experiencing gains against major currencies but seeing a slight weakening against the US dollar due to ongoing geopolitical tensions in West Asia, as explained by an analyst. At 6 pm, the local currency slipped to 4.0750/0800 against the US dollar from Tuesday's close of 4.0685/0735.
According to BERNAMA News Agency, Dr. Mohd Afzanizam Abdul Rashid, chief economist at Bank Muamalat Malaysia Bhd, highlighted that crude oil prices surged significantly following military actions by the United States against Iranian forces. This development indicates the precarious nature of the ceasefire agreement, particularly after the US government's decision to revoke the waiver on Iranian oil sales. Such actions raise apprehensions about potential disruptions to the Strait of Hormuz, a vital global oil transportation route.
At present, benchmark Brent crude for the September contract is trading 5.68 per cent higher at US$78.28 per barrel. Dr. Mohd Afzanizam pointed out that market participants are also anticipated to closely analyze the Federal Open Market Committee (FOMC) minutes set to be released on July 9.
On the domestic scene, Bank Negara Malaysia's (BNM) Monetary Policy Committee (MPC) is scheduled to convene to deliberate the Overnight Policy Rate (OPR). The consensus among economists is that the benchmark rate will likely remain stable at 2.75 per cent. The MPC will conduct its fourth meeting of the year tomorrow.
At the market close, the ringgit demonstrated strength against a range of major currencies. It advanced against the Japanese yen to 2.5083/5114 from the previous day's 2.5124/5156, gained ground against the British pound to 5.4369/4435 from 5.4432/4499, and appreciated against the euro to 4.6471/6528 from 4.6483/6540 on the prior day.
Conversely, the local currency showed minimal movement against regional currencies. It remained almost unchanged against the Singapore dollar at 3.1487/1528 from 3.1488/1529 and made slight progress against the Thai baht to 12.1685/1882 from the previous day's 12.2129/2331. The ringgit held steady against the Indonesian rupiah at 226.2/226.5 from 226.2/226.6 and was also unchanged against the Philippine peso at 6.62/6.64 from 6.62/6.63 at the close on Tuesday.