Ringgit rises against US dollar on softer greenback

 The local note strengthens to 3.9250/3.9340 amid concerns over reduced demand for US assets.

KUALA LUMPUR:

 The ringgit opened firmer against the US dollar on Tuesday, supported by broad-based weakness in the greenback amid concerns over reduced demand for US assets.

At 8am, the ringgit strengthened to 3.9250/3.9340 against the greenback from Monday’s close of 3.9325/3.9375.

Bank Muamalat Malaysia Bhd chief economist Afzanizam Rashid said the US dollar weakened following reports that China’s authorities had advised domestic financial institutions to reduce their holdings of US Treasury bonds.

“This has led to a softer US dollar, with the US Dollar Index (DXY) declining by 0.79% to 96.865 points,” he noted.

Afzanizam said the main rationale behind the move was concerns over risk concentration and heightened market volatility.

He said that based on the latest data, China’s holdings of US Treasury bonds stood at US$682.6 billion as of November 2025, significantly lower than the peak of US$1.3 trillion recorded in July 2011.

“Yesterday, the ringgit closed higher against the US dollar. On that note, the ringgit is likely to remain firm at around RM3.92 to RM3.94 due to weakness in the US dollar,” he added.

At the opening, the ringgit traded lower against a basket of major currencies.

It depreciated against the British pound to 5.3698/5.3821 from 5.3482/5.3550, eased against the euro to 4.6723/4.6830 from 4.6647/4.6707 previously, and weakened against the Japanese yen to 2.5138/2.5197 from 2.5104/2.5137 at Monday’s close.

The local note was, however, mostly higher against its Asean peers, except for a decline against the Singapore dollar to 3.1001/3.1077 from 3.0979/3.1021 previously.

It rose against the Philippine peso to 6.71/6.73 from 6.72/6.74 yesterday, appreciated vis-à-vis the Indonesian rupiah to 233.5/234.2 from 234.0/234.4, and strengthened against the Thai baht to 12.5813/12.6207 from 12.5876/12.6101. - FMT