Ringgit gains at opening as Budget 2027 signals fiscal restraint
The currency stood at 4.0820/0880 against the US dollar at 8 am, with gains also recorded against sterling and the euro.
The ringgit started Oct 12 trading slightly stronger against the US dollar following the government’s fiscal discipline pledge in Budget 2027. Its 8 am quotation was 4.0820/0880, compared with 4.0830/0875 when trading ended the preceding Friday.
Dr Mohd Afzanizam Abdul Rashid, chief economist at Bank Muamalat Malaysia Bhd, cited the government’s deficit target as an indication of its fiscal commitment. The target for 2027 is 3.3 per cent of gross domestic product, compared with the estimated 3.6 per cent.
In his view, that approach should support the ringgit by helping to safeguard Malaysia’s sovereign credit rating. But he cautioned that developments in West Asia left external conditions uncertain, including possible consequences for global crude oil prices.
He also said markets would watch whether further interest rate increases were considered by the US Federal Reserve during the month. His expectation for Oct 12 was limited movement in the ringgit’s exchange rate against the dollar.
The opening currency quotations showed gains for the ringgit against most major and ASEAN counterparts, although it slipped against the yen:
- British pound: 5.4038/4117; preceding Friday close: 5.4063/4123.
- Euro: 4.5735/5802; previous quotation: 4.5807/5858.
- Japanese yen: 2.5806/5846; preceding Friday quotation: 2.5791/5821.
- Singapore dollar: 3.1876/1928; preceding Friday close: 3.1896/1934.
- Thai baht: 12.1720/1957; previous quotation: 12.1735/1909.
- Indonesian rupiah: 228.0/228.4; preceding Friday close: 228.1/228.4.
- Philippine peso: unchanged at 6.50/6.51.
