THE ringgit is expected to trade within a narrow range of RM4.02 to RM4.04 against the US dollar next week as investors remain wary of mounting geopolitical tensions and growing uncertainty in the global economic outlook.
Analysts believe developments in the Middle East, particularly the continuing impasse between the United States and Iran, are likely to remain a key driver of market sentiment, with concerns that prolonged tensions could fuel higher energy prices and intensify inflationary pressures worldwide.
Bank Muamalat Malaysia Bhd Chief Economist Dr Mohd Afzanizam Abdul Rashid said the deadlock in negotiations between Washington and Tehran could contribute to sustained increases in fuel prices, raising concerns about inflation and monetary policy across major economies.
“Therefore, discussions on global interest rate increases are expected to gain momentum, resulting in cautious trading activity in the currency market,” he said.
Apart from external risks, domestic political developments are also contributing to investor caution ahead of the upcoming state elections in Johor and Negeri Sembilan.
According to Mohd Afzanizam, political uncertainty surrounding the electoral contests is likely to remain one of several factors influencing market behaviour in the near term.
The ringgit ended the week on a weaker footing against the US dollar, closing at 4.0280/0320 compared with 3.9625/9670 a week earlier, reflecting the broader strengthening of the greenback amid global risk aversion.
The local currency also weakened against a basket of major international currencies throughout the week.
Against the British pound, the ringgit fell to 5.4233/4287 from 5.3165/3225 previously. It also declined against the euro, trading at 4.6882/6928 compared with 4.6127/6180 a week earlier.
The ringgit similarly lost ground against the Japanese yen, weakening to 2.5183/5209 from 2.4874/4904.
Regional currencies also outperformed the ringgit during the week, highlighting the challenging environment faced by emerging market currencies amid heightened global uncertainty.
The Malaysian currency slipped against the Indonesian rupiah to 223.3/223.6 from 221.6/221.9 previously. It also weakened against the Singapore dollar to 3.1390/1424 from 3.1010/1048, while declining against the Thai baht to 12.3433/3605 from 12.1732/1926.
Against the Philippine peso, the ringgit eased to 6.55/6.56 compared with 6.43/6.44 a week earlier.
With geopolitical risks, energy market volatility and domestic political developments expected to remain in focus, currency traders are likely to maintain a defensive stance in the coming week as they assess the direction of global interest rates and broader economic conditions. - June 7, 2026
