Kuala lumpur: The ringgit climbed to another new high at Tuesday's closing, touching 4.0615, the strongest level last seen in early March 2021, as expectations of a United States (US) interest rate cut continued to pressure the greenback. At 6 pm, the local currency surged to 4.0615/0665 versus the greenback, from 4.0770/0800 at yesterday's close. The ringgit reached 4.0747 on March 5, 2021.
According to BERNAMA News Agency, Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid noted that the ringgit continued to appreciate further today, as anticipation of an interest rate cut in the US remained the key factor driving the weaker US dollar. He explained that foreign exchange traders are optimistic about the ringgit in the near term, with RM4.00 being the next hurdle. The long-term average of USD-MYR from the moment of the ringgit peg removal in 2005 to the present is about RM3.82, indicating room for further appreciation.
Mohd Afzanizam highlighted that the US Dollar Index (DXY) fell 0.35 percent to 97.938 points. Concerning the US gross domestic product data for the third quarter of 2025 (3Q 2025) due later today, he suggested that weaker-than-expected data would solidify the anticipation of an interest rate cut going forward. He mentioned that Federal Reserve governor Stephen Miran had discussed the possibility of a US recession, underscoring the need for an interest rate cut. A weaker US 3Q 2025 GDP outcome could boost market sentiments, especially towards emerging market currencies.
At the close, the ringgit was traded lower against a basket of major currencies. It edged down against the euro to 4.7901/7960 from 4.7827/7862 at Monday's close, fell against the British pound to 5.4851/4918 from 5.4750/4790, and depreciated against the Japanese yen to 2.6039/6072 from 2.5896/5916.
The local currency traded mostly higher against ASEAN peers. It strengthened versus the Thai baht to 13.0486/0705 from 13.0740/0895, appreciated against the Indonesian rupiah to 241.9/242.3 from 242.9/243.3 previously, and was up against the Philippine peso to 6.90/6.91 from 6.94/6.95, but weakened against the Singapore dollar to 3.1607/1648 from 3.1592/1618.