Ringgit hits 5-year high against US dollar, strengthens against Singapore dollar

The ringgit continued its rally to reach its highest level in about five years against the US dollar, moving below the 4.00 mark at around 2.25pm on Friday (Jan 23).

Based on a tally of the USD/MYR historical data, it was last seen trading at this level — 3.99 — in June 2018. 

Dr Mohd Afzanizam Abdul Rashid, chief economist at Bank Muamalat Malaysia, told New Straits Times that the Malaysian central bank's monetary policy committee's decision to keep the overnight policy rate at 2.75 per cent reinforced expectations of policy stability, thereby supporting the ringgit. 

He added that market sentiment has improved after US President Donald Trump softened his stance on Greenland. 

This mirrored US dollar's retreat against the euro and pound sterling on Thursday (Jan 22) as Trump dropped tariff threats against eight European countries.

Analysts whom Bernama spoke to expressed similar views, saying that policy stability and easing US dollar strength, alongside expectations that the US Federal Reserve would keep interest rates unchanged, supported the ringgit's gains. 

The ringgit also rose against the Singapore dollar to 3.1312 on Friday, while similarly strengthening against the Japanese yen, Philippines peso and Thai baht. 

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editor@asiaone.com