Ringgit opens slightly lower ahead of BNM meeting

THE ringgit opened slightly lower against the US dollar on Wednesday, as investors remained cautious ahead of Bank Negara Malaysia’s Monetary Policy Committee (MPC) meeting, with economists divided over the likelihood of an Overnight Policy Rate (OPR) cut, said an analyst.

At 8 am, the local note eased to 4.2380/2660 against the greenback from Tuesday’s close of 4.2365/2445.

Bernama reported Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid saying the case for a 25-basis-point cut is becoming increasingly clear, as downside risks mount in the second half of 2025 amid tariff shocks.

“The current monetary policy stance is also deemed restrictive, with the real interest rate rising to 1.80 per cent in May—well above the long-term average of 0.88 per cent.

“Even so, the ringgit is expected to trade within a narrow range, likely between RM4.23 and RM4.24, as investors await the MPC’s latest policy assessment,” he told Bernama.

On external developments, Mohd Afzanizam noted that the US Dollar Index (DXY) remained relatively stable at around 97.516 points, despite concern over the potential impact of new US tariffs.

At the same time, he said US benchmark equities retreated, with the S&P 500 index down 0.07 per cent to close at 6,255.52 points, while the 10-year US Treasury yield inched up two basis points to 4.40 per cent.

“Markets appear less rattled by the Trump tariff rhetoric compared to April. There may be lingering doubts about the sustainability and implementation of such a policy, given the Trump administration’s track record of flip-flopping,” he added.

At the open, the ringgit was firmer against a basket of major currencies.

It rose against the Japanese yen to 2.8850/9042 from 2.8970/9026, strengthened versus the British pound to 5.7569/7949 from 5.7591/7700, and appreciated against the euro to 4.9682/5.0010 from 4.9745/9839.

The local note was mixed against ASEAN currencies.

It improved vis-à-vis the Singapore dollar to 3.3102/3323 from 3.3152/3217 and rose against the Thai baht to 12.9900/13.0839 from 13.0182/0488.

However, it slipped against the Indonesian rupiah to 261.5/263.3 from 261.4/262.0 and eased versus the Philippine peso to 7.52/7.57 from 7.51/7.53. - July 9, 2025