KUALA LUMPUR: The ringgit opened almost unchanged against the US dollar on Friday as expectations of a tight US monetary policy offset support from a weaker greenback.
At 8am, the ringgit was quoted at 4.0800/0845 against the US dollar, little changed from Thursday’s closing rate of 4.0800/0835.
Bank Muamalat Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said the US Dollar Index (DXY) declined 0.53 per cent to 102.005 points, alongside a drop in Brent crude oil prices to around US$105 per barrel.
He said a weaker US dollar would generally support the ringgit. However, persistent inflationary pressures in the United States and expectations that the Federal Reserve (Fed) would maintain its tight monetary stance could limit gains in the local currency.
Mohd Afzanizam said the International Energy Agency’s (IEA) assurance to release 100 million barrels of oil from its reserves had temporarily eased oil market concerns, although supply disruptions remained unresolved.
Meanwhile, concerns over valuations of artificial intelligence (AI)-related stocks prompted investors to shift towards safe-haven assets, contributing to a decline in US Treasury yields.
He also noted that the latest US Producer Price Index (PPI) for September rose 6.3 per cent, exceeding the consensus forecast of 5.3 per cent. This could encourage the Fed to maintain its tight monetary policy at the Federal Open Market Committee (FOMC) meeting later this month.
On the domestic front, market attention will focus on Malaysia’s advance estimate of gross domestic product (GDP) for the third quarter of 2026.
Mohd Afzanizam expects preliminary growth to reach approximately 5.2 per cent, slower than the 6.0 per cent recorded in the second quarter but still satisfactory, as it remains above the trend level.
He added that expectations of an overnight policy rate (OPR) normalisation could provide further support for the ringgit.
He expects the US dollar-ringgit pair to trade within the RM4.07 to RM4.09 range throughout the day.
Against other major currencies, the ringgit strengthened to 2.5797/5827 against the Japanese yen and 4.5741/5791 against the euro. However, it weakened to 4.4138/4197 against the British pound.
Against ASEAN currencies, the ringgit was little changed at 227.4/227.8 against the Indonesian rupiah and remained steady at 6.47/6.48 against the Philippine peso.
The local currency edged lower to 3.1820/1858 against the Singapore dollar but strengthened to 12.1675/1889 against the Thai baht.
-AWANI
