KUALA LUMPUR, May 14 (Bernama) – The ringgit opened stronger against the US dollar on Wednesday, buoyed by improved market sentiment following signs of easing trade tensions between the United States and China. Analysts noted that the positive developments have lifted risk appetite among traders and investors while easing recession concerns.
At 8:01 a.m., the local currency rose to 4.3045/3245 against the greenback, compared to 4.3185/3250 at Tuesday’s close.
Bank Muamalat Malaysia Bhd Chief Economist Mohd Afzanizam Abdul Rashid said the latest US Consumer Price Index (CPI) data, which showed a year-on-year increase of 2.3% in April—slightly below the market expectation of 2.4%—helped calm inflation fears.
“The lower CPI indicates that inflationary pressures caused by US tariffs may no longer be a significant concern at this point,” he told Bernama.
He added that the latest economic data suggest the US Federal Reserve (Fed) may have room to adjust its monetary policy, potentially lowering the federal funds rate in the future.
The upcoming Federal Open Market Committee (FOMC) meeting on June 17-18 will be closely watched, as the Fed is expected to release its latest macroeconomic projections for the current quarter.
Meanwhile, the NFIB Small Business Optimism Index dropped to 95.8 in April, marking its fourth consecutive monthly decline since January—another sign of weakening business confidence.
“This adds weight to arguments for a rate cut, as weaker business sentiment typically leads to reduced capital spending and slower hiring activity,” Afzanizam said.
Despite weakening earlier on Tuesday to RM4.34 per dollar in the morning session, the ringgit rebounded by midday to RM4.3218, indicating that there is still notable support for the local currency.
“The support for the ringgit remains strong, especially as improved global equity risk sentiment tends to favour emerging market currencies like the ringgit,” he said.
Afzanizam projected that the USD/MYR pair would likely trade within the RM4.32 to RM4.33 range today.
Performance Against Other Currencies
The ringgit was mostly lower against a basket of major currencies:
Against the Japanese yen, it edged slightly higher to 2.9179/9319 from 2.9181/9227.
Against the euro, it fell to 4.8146/8370 from 4.7961/8033.
Against the British pound, it weakened to 5.7258/7524 from 5.7056/7142.
However, the ringgit strengthened against several ASEAN currencies:
Against the Singapore dollar, it rose to 3.3076/3235 from 3.3084/3137.
Against the Indonesian rupiah, it improved to 258.8/260.2 from 259.7/260.2.
Against the Thai baht, it climbed to 12.9521/13.0229 from 12.9958/13.0240.
Against the Philippine peso, it advanced to 7.71/7.76 from 7.74/7.76.
— BERNAMA
