22 September 2025 — The Malaysian ringgit opened slightly higher against the US dollar on Monday, lifted by confidence in the country’s credit outlook and improving domestic economic data. Market watchers say that recent reassurances from rating agencies and clearer fiscal signals have helped restore some investor sentiment.
Early in today’s trading, the ringgit was quoted at RM4.2000/4.2200 per US dollar, up a touch from its Friday close of about RM4.2040/4.2115. Analysts pointed to a stable outlook from S&P Global Ratings, which recently reaffirmed Malaysia’s sovereign credit rating at “A-” with a stable outlook. This move is seen as validation of the government’s ongoing efforts to rein in the fiscal deficit and maintain macroeconomic order.
Bank Muamalat Chief Economist Dr. Mohd Afzanizam Abdul Rashid noted that Malaysia’s fiscal deficit has narrowed to approximately 4.2% of GDP in the first half of 2025, down from about 5.5% in the same period last year. Meanwhile, debt remains at around 62% of GDP, below the statutory threshold of 65%.
On the external side, movements in the U.S. Dollar Index (DXY) have also played a role. After a recent rate cut by the U.S. Federal Reserve, the DXY has rebounded and is hovering near 97 points. Traders are waiting for key upcoming U.S. data — such as inflation figures — to gauge whether further interest rate reductions are likely. These global signals tend to ripple through emerging market currencies like the ringgit.
Against other major currencies, the ringgit showed modest strength. It firmed against the Japanese yen, British pound, and the euro. Regionally, it also gained ground versus several ASEAN neighbours, including the Singapore dollar, Thai baht, Indonesian rupiah, and the Philippine peso.
Looking ahead, analysts believe that expectations of additional U.S. rate cuts later this year could limit the ringgit’s downside risk. However, they caution that any sharp shift in global interest rate expectations, inflation surprises, or geopolitical developments may influence the ringgit’s volatility.
