The ringgit opened slightly lower against the US dollar on Wednesday as investors remained cautious ahead of Bank Negara Malaysia's (BNM) Monetary Policy Committee (MPC) meeting on the possibility of an OPR cut.
At 10am, the ringgit was at 4.2500, down 0.31% against the US dollar from its close of 4.2365 at the end of Tuesday.
Bank Muamalat Malaysia Bhd Chief Economist Dr Mohd Afzanizam Abdul Rashid said the case for a 25 basis point cut was becoming clearer, as downside risks increased in the second half of 2025 amid tariff shocks.
He said the current monetary policy stance was also considered restrictive, with real interest rates rising to 1.80 per cent in May, well above the long-term average of 0.88 per cent.
The ringgit is expected to trade in a narrow range, likely between RM4.23 and RM4.24, as investors await the MPC's latest policy assessment.
On external developments, Mohd Afzanizam noted that the US Dollar Index (DXY) remained relatively stable at around 97.516 points, despite concerns over the potential impact of new US tariffs.
At the open, the ringgit was stronger against a basket of major currencies.
It rose against the Japanese yen to 2.8850/9042 from 2.8970/9026, strengthened against the British pound to 5.7569/7949 from 5.7591/7700, and appreciated against the euro to 4.9682/5.0010 from 4.9745/9839.
The local note was mixed against ASEAN currencies.
It improved against the Singapore dollar to 3.3102/3323 from 3.3152/3217 and rose against the Thai baht to 12.9900/13.0839 from 13.0182/0488.
However, it depreciated against the Indonesian rupiah to 261.5/263.3 from 261.4/262.0 and depreciated against the Philippine peso to 7.52/7.57 from 7.51/7.53
