THE ringgit advanced in early trading on Tuesday, benefiting from a softer US dollar as financial markets responded positively to signs of easing tensions between Iran and Israel.
The local currency strengthened to 4.0665/4.0780 against the US dollar at the opening bell, compared with Monday's closing level of 4.0715/4.0760, as investors trimmed demand for safe-haven assets following indications of a reduction in hostilities in West Asia.
Bank Muamalat Malaysia Bhd Chief Economist Dr Mohd Afzanizam Abdul Rashid told Bernama tha the US Dollar Index (DXY) edged lower to 99.98 points amid expectations that both Iran and Israel could be moving towards a reduction in military strikes, although the situation remained uncertain.
“Market sentiment is likely to stay cautious ahead of the US consumer price index (CPI) release tomorrow.
“In light of the ongoing war and its impact on fuel prices, amid the strong non-farm payrolls (NFP) outturn last week, the Federal Reserve is likely to maintain its restrictive monetary policy stance,” he added.
Investors are now closely watching the upcoming US inflation report, which is expected to influence expectations surrounding future Federal Reserve interest-rate decisions.
Strong inflationary pressures, combined with resilient labour market data, could reinforce the case for keeping borrowing costs elevated for longer.
Against a basket of major currencies, the ringgit posted a mixed but generally stronger performance.
The local unit appreciated against the British pound to 5.4219/5.4372 from 5.4249/5.4309 previously and strengthened against the Japanese yen to 2.5385/2.5459 from 2.5445/2.5475.
However, it eased marginally against the euro, trading at 4.6879/4.7011 compared with 4.6867/4.6919 at Monday’s close.
Regional currency trading also reflected growing confidence in emerging Asian markets.
The ringgit gained against the Singapore dollar, improving to 3.1548/3.1639 from 3.1577/3.1614, while strengthening against the Thai baht to 12.3639/12.4049 from 12.3942/12.4128.
It also edged higher against the Philippine peso at 6.59/6.61 from 6.60/6.61 and advanced against the Indonesian rupiah to 223.5/224.3 from 223.8/224.2 previously.
Market participants are expected to remain focused on geopolitical developments in the Middle East and the latest US economic indicators, both of which are likely to shape currency movements in the days ahead. - June 9, 2026
