The ringgit opened higher against the US dollar on Monday, supported by improved market sentiment following investor confidence in the possibility of progress in talks between the United States and Iran.
At 10.10am, the ringgit was trading at 3.9480, up 0.43% since it opened early Monday in Asian trade.
Reports said the United States and Iran were negotiating a deal that could lead to the reopening of the Strait of Hormuz, a key global oil shipping route that handles about 20% of the world's oil supply.
Bank Muamalat Malaysia Bhd Chief Economist Dr Mohd Afzanizam Abdul Rashid said the US Dollar Index (DXY) fell 0.25% to 98.987 points, while S&P 500 futures rose 0.61% to 7536.50 points, reflecting risk-on sentiment among traders and investors.
Meanwhile, West Texas Intermediate (WTI) and Brent crude oil prices fell more than five percent to $91.75 and $98.33 per barrel respectively.
He said the ringgit had the potential to continue strengthening following improving market sentiment, with the local currency against the US dollar expected to move towards RM3.95.
He also said better macroeconomic indicators such as the growing current account surplus and the narrowing fiscal deficit in the first quarter of 2026 indicated that the risk of Malaysia becoming a twin deficit economy remained low.
At the opening of trade, the ringgit was traded lower against a basket of major currencies.
The ringgit weakened against the Japanese yen to 2.4934/4980 from 2.4925/4954 at Friday's close, depreciated against the British pound to 5.3432/3526 from 5.3245/3305 and eased against the euro to 4.6143/6225 from 4.6012/6064 previously.
The local currency was traded mixed against regional currencies.
The ringgit weakened against the Singapore dollar to 3.1030/1090 from 3.0985/1023 at Friday's close and weakened against the Thai baht to 12.1954/2248 from 12.1421/1611 previously.
However, the ringgit rose against the Indonesian rupiah to 223.7/224.2 from 223.8/224.1 and was unchanged against the Philippine peso at 6.42/6.44.
