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Ringgit Strengthens, Yet USD Pressure Persists
FX MarketEmerging Markets
The ringgit opened slightly higher against the US dollar and most major currencies on Tuesday; however, market sentiment remained cautious as geopolitical risks continued to drive investors toward defensive assets. At 8:00 a.m., the ringgit appreciated to 4.0800/4.0865 against the US dollar, up from 4.0805/4.0845 at Monday's close. Bank Muamalat Malaysia Bhd Chief Economist Dr. Mohd Afzanizam Abdul Rashid noted that Brent crude oil prices remained above US$106 per barrel on Monday following the standoff between the United States and Iran, thereby sustaining concerns regarding energy-driven inflationary pressure. He added that US Treasury yields had also risen significantly, with the two-year and 10-year securities yielding approximately 4.9% and 5.2%, respectively. According to him, the rise in US Treasury yields enhances the relative attractiveness of US dollar-denominated assets and could potentially dampen demand for emerging market currencies, including the ringgit. Malaysian Economy Remains Robust On the domestic front, Malaysia's economy continued to demonstrate strong growth, with Gross Domestic Product (GDP) expanding by 6.0% in the second quarter of 2026, compared to 5.4% in the first quarter.