THE RINGGIT opened higher this morning as markets anticipate the country will be among the least affected by the United States’ upcoming reciprocal tariffs, set to take effect on April 2.
Analysts suggest that Malaysia's relatively low tariff rates could shield it from significant economic disruption.
At 8am, the ringgit was valued at 4.4155/4230 against the US dollar, showing a slight improvement from Friday's closing rate of 4.4180/4220.
Bank Muamalat Malaysia Bhd Chief Economist Dr. Mohd Afzanizam Abdul Rashid, told Bernama today that the currency's upward movement reflected market optimism ahead of the tariff implementation by the US government.
"Market participants will closely examine the details of the reciprocal tariffs to assess how they will impact the economies of various countries," he explained.
"Concerns persist that these tariffs could result in slower economic growth, which might prompt swift policy action from central banks globally to sustain growth. Such concerns often drive traders and investors into defensive positions, boosting demand for safe-haven currencies like the US dollar."
Referring to data from the World Trade Organisation (WTO), Afzanizam noted that countries such as India, Bangladesh, and South Korea face higher average tariff rates than Malaysia. India’s tariff rate stands at 17.1%, Bangladesh's at 14.1%, and South Korea’s at 13.4%, compared to Malaysia’s relatively low rate of 5.6%.
"In this context, Malaysia could potentially experience one of the least severe impacts from the tariffs," he added.
The ringgit also made gains against other major currencies. It strengthened against the British pound, climbing to 5.7062/7158 from 5.7151/7203 last Friday. It appreciated further against the Japanese yen, rising to 2.9500/9552 from 2.9574/9602, and remained stable against the euro, with a slight change to 4.7842/7923 compared to 4.7843/7886 previously.
Against ASEAN currencies, the ringgit showed a positive trend, edging up against the Singapore dollar to 3.3075/3134 from 3.3081/3114. It was nearly unchanged against the Philippine peso, at 7.70/7.72 compared to 7.70/7.71, and strengthened against the Indonesian rupiah to 267.5/268.1 from 267.7/268.0. Additionally, the ringgit gained against the Thai baht, rising to 13.0235/0545 from 13.0436/0608. – March 24, 2025
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