Ringgit ends higher against major currencies, weaker versus the US dollar

SINGAPORE, 23 SEPTEMBER 2026 —

Ringgit Weakens Against US Dollar Amid Fed Rate Hike Expectations, Strengthens Against Euro and Yen

The Malaysian ringgit weakened against the US dollar on Wednesday, closing at RM4.0780/0825—its lowest level since Tuesday’s close of RM4.0730/0775—as persistent expectations of further Federal Reserve interest rate hikes bolstered the greenback. Meanwhile, the currency gained against the euro, British pound, and Japanese yen, reflecting broader regional currency movements amid mixed trading conditions.

The ringgit’s decline against the US dollar shows the persistent pressure on emerging-market currencies as global investors anticipate tighter monetary policy from the Fed. Bank Muamalat Malaysia Bhd chief economist Dr. Mohd Afzanizam Abdul Rashid noted that markets are pricing in another 50-basis-point rate hike by the Fed later this year, reinforcing the dollar’s strength.

"The ringgit started the day stronger, reaching RM4.0640 in the morning, but could not sustain that momentum as the US dollar remained firm," he told Bernama. By afternoon, the ringgit had retreated to RM4.0780, aligning with broader trends in Asia where currencies displayed mixed performance.

The ringgit’s performance against major currencies showed a stark contrast. It gained against the euro, closing at RM4.6522/6573—up from Tuesday’s RM4.6705/6757—and strengthened against the British pound to RM5.4156/4216 from RM5.4452/4512. Similarly, it appreciated against the Japanese yen, closing at RM2.5836/5868 compared to RM2.5958/5988 the previous day. These gains suggest that while the ringgit remains vulnerable to dollar strength, it has benefited from broader risk-on sentiment in global markets.

In intra-ASEAN trading, the ringgit’s movements were mixed. It appreciated against the Singapore dollar, closing at RM3.1909/1947—up from RM3.1955/1993—and strengthened against the Thai baht to RM12.2599/2782 from RM12.2847/3035. However, it declined against the Indonesian rupiah, closing at RM228.8/229.2 compared to RM227.7/228.0, and weakened against the Philippine peso to RM6.51/6.52 from RM6.49/6.50. These shifts indicate that while Malaysia’s currency has held its ground against some regional peers, others have faced similar pressures from global risk factors.

For Malaysian businesses and investors, the ringgit’s volatility against the US dollar poses challenges, particularly for importers and debt-servicing entities. A weaker ringgit increases the cost of dollar-denominated imports and foreign debt repayments, potentially squeezing corporate margins. Meanwhile, exporters may benefit from a more competitive exchange rate, though the overall impact depends on commodity prices and global demand.

Dr. Afzanizam noted that the ringgit’s inability to sustain early-day gains highlights its sensitivity to external monetary policy shifts, particularly from the Fed.

Looking ahead, the ringgit’s trajectory will hinge on two key factors: the Fed’s next policy move and domestic economic stability. If the Fed delivers another aggressive rate hike, the ringgit could face further downward pressure, particularly if risk aversion intensifies. Conversely, if global markets stabilize or the Fed signals a pause, the ringgit may recover some lost ground.

Locally, Bank Negara Malaysia’s stance on capital flows and inflation management will also play a critical role in shaping the currency’s resilience.

The ringgit’s mixed performance on Wednesday reflects the broader tensions between global monetary policy and regional economic fundamentals. While Malaysia’s currency has shown relative strength against the euro and yen, its weakness against the dollar points to the persistent challenges posed by US interest rate expectations. For now, traders and policymakers will remain vigilant as the Fed’s next steps loom large over emerging-market currencies, including the ringgit.

Related: Bank Muamalat Malaysia Bhd · Dr. Mohd Afzanizam Abdul Rashid