Ringgit firms as dollar retreats following U.S. Fed minutes

THE ringgit opened stronger against the US dollar on Thursday, buoyed by greenback weakness after the release of the latest US Federal Reserve minutes, which suggested policymakers remain divided over future interest rate moves.

At 8 am, the Malaysian currency stood at RM4.2190/2335 against the US dollar, compared with Wednesday’s closing rate of RM4.2250/2290.

Bernama cited Bank Muamalat Malaysia Bhd’s chief economist Dr Mohd Afzanizam Abdul Rashid saying the minutes revealed that the Federal Reserve was in a “holding pattern” as it evaluated the impact of tariff-related shocks on the economy, particularly on inflation.

“The debate hinges on whether the impact will be transitory or persistent,” he said.

Dr Afzanizam noted that Michelle Bowman and Christopher Waller, the two FOMC members who dissented and supported a 25 basis-point cut, “strongly believed the tariff-driven inflationary impact would be temporary.”

The US Dollar Index (DXY) slipped 0.05 per cent to 98.218 following the release of the minutes, which sent mixed signals to investors. Markets are now turning their attention to Federal Reserve Chair Jerome Powell’s address at the Jackson Hole Symposium scheduled for Friday.

“Perhaps there will be more clues as to how the Fed might decide at the September FOMC meeting,” Dr Afzanizam added. “In the meantime, we expect the ringgit to trade within a narrow range as traders remain cautious, although the odds of a 25 bps cut in September are high.”

He projected the local unit to hover around RM4.22 to RM4.23 against the greenback for the remainder of the day.

The ringgit also appreciated against several major and regional currencies. It strengthened against the euro to 4.9156/9325 from 4.9196/9242, and inched higher against the Japanese yen to 2.8646/8747 from 2.8648/8677. Against the British pound, it advanced to 5.6809/7004 from 5.7033/7087.

In regional trade, the ringgit climbed to 3.2828/2943 versus the Singapore dollar from 3.2864/2898, rose against the Thai baht to 12.9528/13.0037 from 12.9756/9935, edged up to 259.2/260.2 against the Indonesian rupiah from 259.6/260.0, and improved to 7.40/7.43 versus the Philippine peso from 7.41/7.42. - August 21, 2025