THE ringgit advanced against the US dollar in early trading on Friday as growing optimism over a possible diplomatic agreement between Washington and Tehran improved investor sentiment and reduced demand for traditional safe-haven assets.
The local currency opened stronger at 4.0505/0615 against the greenback, compared with Thursday's closing level of 4.0650/0690, reflecting renewed confidence in emerging market currencies amid easing geopolitical tensions in the Middle East.
Market sentiment was boosted after indications from United States President Donald Trump that negotiations with Iran were nearing completion, raising expectations that shipping traffic through the strategically important Strait of Hormuz could soon return to normal.
Bank Muamalat Malaysia Bhd Chief Economist Dr Mohd Afzanizam Abdul Rashid said the prospect of an agreement had helped calm fears over global energy supplies and contributed to a broader retreat in the US dollar.
"Meanwhile, crude oil prices such as West Texas Intermediate (WTI) and Brent fell by 1.97 per cent and 2.92 per cent to US$85.98 per barrel and US$90.38 per barrel, respectively."
"The US Dollar Index (DXY) was also down by 0.28 per cent to 99.672 points as a result. In addition, US initial jobless claims rose for the third week in a row to 229,000 last week," he told Bernama.
The decline in the US Dollar Index signalled a broad weakening of the greenback against major global currencies, providing additional support for the ringgit and other regional units.
Against a basket of major currencies, however, the ringgit delivered a mixed performance.
The Malaysian currency strengthened against the Japanese yen, improving to 2.5293/5364 from 2.5321/5347 previously.
It was marginally weaker against the British pound, trading at 5.4337/4485 compared with 5.4325/4378 at Thursday's close, while also easing against the euro to 4.6889/7016 from 4.6878/6924.
Across the region, the ringgit outperformed most of its Asian counterparts as investors responded positively to the easing geopolitical outlook.
The local note gained against the Singapore dollar, strengthening to 3.1541/1632 from 3.1556/1589 previously.
It also advanced against the Indonesian rupiah to 225.1/225.8 from 225.9/226.2 and improved against the Philippine peso to 6.60/6.62 from 6.62/6.63.
The only notable exception among regional currencies was the Thai baht, against which the ringgit edged lower to 12.3623/4023 compared with 12.3331/3501 on Thursday.
The stronger opening reflects a broader shift in investor sentiment towards risk-sensitive assets as traders monitor developments in US-Iran negotiations, movements in global oil prices and economic indicators from the United States that could influence the direction of monetary policy and currency markets in the weeks ahead. - June 12, 2026
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