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THE ringgit strengthened sharply in early Thursday trading, buoyed by renewed confidence in global financial markets and mounting expectations that Bank Negara Malaysia (BNM) will maintain interest rates at current levels amid stable domestic economic conditions.
The currency extended gains recorded in the previous session as investors reacted positively to signs of easing geopolitical tensions and stronger appetite for riskier assets worldwide.
At the opening bell, the ringgit traded at 3.9050/3.9300 against the US dollar, improving from Wednesday’s closing rate of 3.9230/3.9275 and moving closer towards the psychologically important RM3.90 level.
Financial markets are now firmly anticipating that BNM will leave the Overnight Policy Rate (OPR) unchanged at 2.75 per cent during its Monetary Policy Committee meeting later on Thursday, while investors await fresh guidance on inflation trends and Malaysia’s economic outlook.
Analysts said the local currency was also supported by broader weakness in the US dollar following reports that Washington and Tehran could be nearing an agreement to ease tensions surrounding the Strait of Hormuz, a key global energy shipping route.
Bank Muamalat Malaysia Bhd Chief Economist Dr Mohd Afzanizam Abdul Rashid said improving diplomatic prospects had sparked a broad rally across global equity and bond markets, lifting sentiment towards emerging-market currencies including the ringgit.
“Risk appetite improved substantially. S&P 500 and Nasdaq jumped 1.46 per cent and 2.02 per cent in a single day, respectively, to close at 7,365.12 points and 25,838.94 points. The two- and 10-year US Treasury yields fell eight basis points each to 3.87 per cent and 4.35 per cent, respectively.
“The US Dollar Index (DXY) fell 0.43 per cent to 98.023 points.
“As such, the ringgit could stage further appreciation today with BNM likely to keep the OPR steady at 2.75 per cent. Perhaps today, the US dollar-ringgit pair may move towards RM3.90,” he said.
The ringgit also recorded gains against a basket of major global currencies during early trading.
It strengthened against the euro to 4.6058/4.6170 from 4.6189/4.6242 at Wednesday’s close and climbed against the British pound to 5.3280/5.3409 from 5.3443/5.3504 previously.
The local unit also appreciated against the Japanese yen, trading at 2.5046/2.5109 compared with 2.5159/2.5191 a day earlier.
Across the region, the ringgit outperformed several Asian peers as investors shifted towards higher-yielding regional currencies amid improving market confidence.
The Malaysian currency advanced against the Singapore dollar to 3.0909/3.0986 from 3.0946/3.0986 previously and strengthened against the Thai baht to 12.1536/12.1898 from 12.1866/12.2074.
It remained broadly stable against the Indonesian rupiah at 225.4/226.1 from 225.6/225.9 and traded unchanged against the Philippine peso at 6.39/6.41.
Market participants are expected to scrutinise BNM’s policy statement later in the day for indications on the central bank’s assessment of domestic demand, inflationary pressures and external risks amid continuing uncertainty in the global economy. - May 7, 2026
