KUALA LUMPUR, 27 March 2026 – The Malaysian ringgit has weakened past the key psychological level of RM4.00 against the US dollar, marking its lowest point in nearly two months as global uncertainties and geopolitical tensions weigh heavily on currency markets.
At midday trading, the ringgit slipped to around 4.0070, down about 0.33%, breaking through the RM4.00 threshold after weeks of relative stability.
External Pressures Drive Currency Weakness
The latest decline reflects a strengthening US dollar, driven by rising global oil prices and renewed inflation concerns in the United States. These developments have reinforced expectations that the Federal Reserve may maintain a more hawkish monetary stance.
At the same time, escalating geopolitical tensions, particularly in West Asia, have dampened investor risk appetite, prompting a shift toward safe-haven assets such as the US dollar.
The ongoing disruptions to oil flows via the Strait of Hormuz and persistent military tensions have further amplified volatility across global financial markets.
Risk-Off Sentiment Weighs on Emerging Currencies
The ringgit’s decline mirrors broader trends across emerging market currencies, which typically come under pressure during periods of global uncertainty.
Analysts note that heightened risk aversion, coupled with a stronger US Dollar Index, has triggered capital outflows from regional markets, including Malaysia.
The local currency also weakened against other major currencies, including the euro, British pound and Japanese yen, highlighting the broad-based nature of the sell-off.
Oil Prices and Fed Outlook Key Drivers
With Brent crude hovering near US$100 per barrel, inflation risks in the US have intensified, prompting markets to reassess the timing of potential rate cuts.
A more prolonged period of higher interest rates in the US would continue to support the dollar, placing sustained pressure on currencies like the ringgit.
Kenanga Investment Bank Research expects the ringgit to hover around the RM4.00 level in the near term, as geopolitical risks and monetary policy expectations remain key determinants.
Technical Levels and Market Outlook
From a technical perspective, analysts highlight resistance at RM4.02 and support around RM3.96, suggesting that the currency may trade within this range in the short term.
The recent move also reflects a correction after the ringgit’s earlier outperformance, with markets now adjusting to a more uncertain global environment.
Implications for Malaysian Economy and Investors
For Malaysia, a weaker ringgit presents a mixed picture. Export-oriented sectors may benefit from improved competitiveness, while import costs, particularly for energy and raw materials, are likely to rise.
Currency volatility could also influence foreign fund flows, impacting both equity and bond markets.
For investors, the current environment underscores the importance of monitoring global macro drivers, particularly US monetary policy and geopolitical developments, which are now dominating currency movements.
Outlook: Volatility to Persist
Looking ahead, the ringgit’s trajectory will largely depend on external factors, including the evolution of geopolitical tensions and the Federal Reserve’s policy direction.
With uncertainties expected to persist, the ringgit is likely to remain volatile in the near term, hovering around the RM4.00 level as markets navigate a complex global landscape.
