Malaysian Ringgit Weakens as US Federal Reserve Signals Rate Hikes

The Malaysian ringgit experienced volatility against the US dollar between September 23 and 24, 2026, ultimately trending lower as US economic indicators strengthened. The currency opened higher on Wednesday at 4.0680/0765, supported by easing Brent crude prices and optimism following a meeting between Donald Trump and Iranian officials. However, the ringgit reversed these gains by Wednesday's close, ending at 4.0780/0825.

Pressure intensified on September 24, with the ringgit opening lower at 4.0835/0910. This decline followed a 0.49 percent rise in the US Dollar Index and a US Composite Purchasing Managers’ Index Output Index that hit a 62-month high of 58.4 points. US Treasury yields for two- and 10-year notes jumped to 4.85 percent and 5.11 percent, respectively, after Federal Reserve Governor Michael Barr suggested the central bank is likely to resume interest rate hikes this year.

Despite the weakness against the greenback, the ringgit maintained strength against a basket of major currencies, including the euro, British pound, and Japanese yen. Its performance against ASEAN peers remained mixed, appreciating against the Singapore dollar and Thai baht while declining against the Indonesian rupiah and Philippine peso.