THE ringgit is expected to remain within a narrow trading range against the US dollar next week as investors weigh Malaysia’s stronger-than-expected economic performance against mounting geopolitical uncertainty in the Middle East.
Bank Muamalat Malaysia Bhd Chief Economist Dr Mohd Afzanizam Abdul Rashid said the local currency is projected to trade between RM3.94 and RM3.96 against the greenback, supported by solid domestic fundamentals and continued economic expansion.
He said Malaysia’s economy had thus far demonstrated considerable resilience, with both domestic consumption and external demand continuing to drive growth beyond earlier expectations.
“However, the second half of this year would be more critical should the war in Iran and the blockage of the Strait of Hormuz persist,” he told Bernama.
The cautious outlook comes despite encouraging economic indicators released by Bank Negara Malaysia on Friday, which showed the economy expanding by 5.4 per cent in the first quarter of 2026, slightly exceeding the advance estimate of 5.3 per cent.
According to the central bank, growth was underpinned by resilient household spending, favourable labour market conditions and sustained government policy support.
Investment activity also remained firm, driven by expenditure on machinery and equipment, structural investments and the implementation of long-term development projects.
Private consumption expanded by 4.7 per cent during the quarter, while private investment grew 7.8 per cent. Net exports surged by 13.5 per cent amid continued export growth and a faster moderation in imports.
Despite the positive economic data, the ringgit weakened slightly against the US dollar at Friday’s close, ending at 3.9515/9580 compared with 3.9185/9230 a week earlier.
Nevertheless, the local currency strengthened against several major global currencies during the week.
The ringgit appreciated against the British pound to 5.2749/2835 from 5.3354/3416 previously, rose against the euro to 4.5948/6024 from 4.6121/6174, and improved against the Japanese yen to 2.4927/4968 from 2.5010/5040.
The local note also posted gains against regional ASEAN currencies.
It strengthened versus the Singapore dollar to 3.0871/0927 from 3.0910/0948, appreciated against the Thai baht to 12.0989/1247 from 12.1640/1844, climbed against the Indonesian rupiah to 224.5/225.0 from 225.4/225.7, and improved against the Philippine peso to 6.40/6.41 from 6.46/6.47.
Economists said the ringgit’s near-term direction would likely continue to depend on external developments, particularly global oil supply risks linked to tensions surrounding Iran and shipping routes through the Strait of Hormuz, one of the world’s most critical energy corridors. - May 16, 2026
