Ringgit opens marginally higher amid market uncertainty

 The local note rises to 3.9300/3.9455 on mild dollar weakness, though gains are capped by high oil prices.

KUALA LUMPUR:

 The ringgit opened slightly higher against the US dollar on Monday, supported by mild dollar weakness, though persistent geopolitical uncertainties and elevated oil prices capped gains.

At 8am, the local note strengthened to 3.9300/3.9455 against the greenback from 3.9365/3.9410 at last Friday’s close.

Bank Muamalat Malaysia Bhd chief economist Afzanizam Rashid said market sentiment is likely to remain cautious amid heightened geopolitical risks in West Asia and persistently high crude oil prices, with Brent crude continuing to hover above US$100 per barrel.

“There are clearly no signs of a let-up in the war involving Iran, while concerns over potential disruptions in the Strait of Hormuz and possible damage to oil and gas facilities in the Gulf region could significantly affect trade flows for such commodities.

“In addition, the geopolitical posture continues to evolve, as the presence of US military bases in West Asia does not necessarily guarantee their safety,” he noted.

Commenting on reports suggesting that Iran could allow oil shipments through the Strait of Hormuz if cargoes are traded in Chinese yuan, Afzanizam said the development may signal deeper shifts in global financial and geopolitical alignments.

“As such, US de-dollarisation is reaching a new level as it becomes increasingly intertwined with geopolitics.

“Already, we have observed the share of the US dollar in global foreign reserves decline from 71.1% in the first quarter of 1999 to 56.9% in the third quarter of 2025,” he added.

Looking ahead, he said investors will be watching the upcoming Federal Open Market Committee meeting scheduled for March 17–18, where policymakers are expected to present their latest quarterly economic projections.

“In December 2025, US Federal Reserve staff projected the Personal Consumption Expenditures Price Index inflation rate to ease to 2.4% in 2026, down from the previous projection of 2.6% made in September 2025.

“On that note, the ringgit is expected to trade within a tight range against the greenback, possibly between RM3.92 and RM3.95 today,” he said.

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

It strengthened against the Japanese yen to 2.4630/2.4729 from 2.4683/2.4715 at Friday’s close, rose against the British pound to 5.2057/5.2262 from 5.2214/5.2273, and appreciated against the euro to 4.4940/4.5117 from 4.5093/4.5144.

The local currency also traded higher against most Asean currencies.

It improved against the Singapore dollar to 3.0641/3.0767 from 3.0730/3.0767 at Friday’s close, gained against the Thai baht to 12.1136/12.1696 from 12.1862/12.2062, strengthened against the Indonesian rupiah to 231.7/232.7 from 232.1/232.5, and edged up against the Philippine peso to 6.58/6.61 from 6.59/6.60 previously. - FMT