Kuala lumpur: The ringgit extended its gains to open firmer on Tuesday, tracking a weaker US Dollar Index (DXY) as tensions between the United States and the European Union intensified following renewed remarks by the administration of US President Donald Trump over Greenland. At 8 am, the local currency strengthened to 4.0475/0575 against the greenback from Monday's close of 4.0520/0570.
According to BERNAMA News Agency, Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid reported that the DXY fell 0.35 percent to 99.050 points. This decline indicates a clear shift into risk-off sentiment, with gold emerging as a safe haven for traders and investors.
He also noted that the International Monetary Fund (IMF) has raised its 2026 global gross domestic product (GDP) growth forecast by 0.2 percentage points to 3.3 percent. This growth is supported by stronger investment in artificial intelligence, accommodative monetary conditions, and fiscal stimulus, which are expected to help offset weaknesses stemming from disruptions to trade policies.
Dr Mohd Afzanizam further mentioned that Malaysia's 2026 GDP growth forecast was revised up by 0.3 percentage points to 4.3 percent. Consequently, the ringgit is expected to remain in rangebound trade due to the risk-off mode prompted by the positive assessment by the IMF on global economic conditions.
In terms of other currencies, the ringgit showed mixed results against a basket of major currencies. It rose against the Japanese yen to 2.5591/5656 from 2.5657/5692 on Monday and edged up against the British pound to 5.4313/4448 from 5.4321/4388. However, it was marginally lower versus the euro to 4.7109/7225 from 4.7100/7159.
The local note mostly appreciated against ASEAN currencies. It gained against the Singapore dollar to 3.1491/1571 from 3.1521/1562, appreciated versus the Thai baht to 12.9454/9886 from 12.9623/9845, and strengthened against the Indonesian rupiah to 238.7/239.4 from 239.0/239.3. However, it remained nearly unchanged versus the Philippine peso, at 6.81/6.83 from 6.81/6.82.