Malaysian Ringgit Fluctuates Ahead of US FOMC Meeting

The Malaysian ringgit experienced volatility between July 27 and July 28, 2026, as investors reacted to geopolitical shifts and anticipated US monetary policy. On July 27, the currency opened and closed higher against the US dollar, reaching 4.0835/0875. Early gains were supported by domestic optimism regarding the Negeri Sembilan state election, though caution persisted regarding the US Federal Open Market Committee (FOMC) meeting scheduled for July 28-29.

Market conditions shifted on July 28, when the ringgit opened weaker against the US dollar at 4.0850/0900. While the currency maintained strength against the euro, British pound, and Japanese yen, it struggled against the greenback due to uncertainty surrounding US-Iran negotiations and expectations of a US interest rate hike. These fluctuations occurred alongside a sharp drop in crude oil prices—with West Texas Intermediate falling 6.98% and Brent crude 7.94%—following the cessation of hostilities between the United States and Iran over the weekend.

Mohd Afzanizam Abdul Rashid, Chief Economist of Bank Muamalat Malaysia Bhd, noted that investors remained cautious as the FOMC meeting was expected to potentially trigger a rate rise, which would increase the value of the US dollar. He highlighted that elevated oil prices had previously exerted upward pressure on inflation, further supporting the likelihood of a rate hike.