THE Malaysian ringgit strengthened in early trading on Friday amid improving investor sentiment driven by signs of easing tensions in West Asia and growing confidence in Malaysia’s strengthening macroeconomic fundamentals.
At the opening bell, the local currency appreciated to 3.9550/9645 against the US dollar, compared with Thursday’s closing rate of 3.9595/9630.
Bank Muamalat Malaysia Bhd Chief Economist Dr Mohd Afzanizam Abdul Rashid said optimism surrounding possible diplomatic progress between the United States and Iran continued to support market sentiment.
According to him, investors were increasingly hopeful that both sides could reach an amicable resolution to ongoing geopolitical tensions that have unsettled global markets in recent months.
He noted that benchmark global crude prices had also declined as concerns over prolonged disruptions to oil supplies eased.
West Texas Intermediate crude fell 1.49 per cent to US$97.79 per barrel, while Brent crude declined 2.32 per cent to US$102.58 per barrel.
“According to the Iranian news agency, Tehran is evaluating the proposal from the US, which has narrowed the gaps to some extent,” he told Bernama.
Afzanizam added that Malaysia’s improving economic position was also helping to support the ringgit, particularly following stronger external and fiscal indicators released for the first quarter of 2026.
He said the country’s current account surplus rose significantly to 3.0 per cent of gross domestic product (GDP) during the first quarter of the year, compared with 0.5 per cent recorded in the previous quarter.
At the same time, the government’s fiscal position continued to improve as the federal deficit narrowed to RM17.1 billion, equivalent to 3.3 per cent of GDP, from RM21.9 billion or 4.5 per cent of GDP during the corresponding period last year.
“Apart from that, the government’s fiscal position continued to improve, with the fiscal deficit narrowing to RM17.1 billion or 3.3 per cent of GDP in the first quarter of 2026 from RM21.9 billion or 4.5 per cent of GDP in the corresponding period of 2025.
“Hence, the ringgit is expected to remain well supported at around RM3.95 to RM3.96 against the US dollar today,” he said.
The local currency also posted gains against other major global currencies.
The ringgit strengthened against the British pound to 5.3120/3247 from 5.3220/3267 previously and appreciated against the euro to 4.5945/6056 from 4.6037/6078.
It also edged higher against the Japanese yen to 2.4866/4928 from 2.4906/4929.
Against regional currencies, the ringgit improved against the Singapore dollar, Thai baht, Indonesian rupiah and Philippine peso, reflecting broader confidence in Malaysia’s near-term economic resilience despite continued uncertainty in global financial markets. - May 22, 2026
