The ringgit opened higher against the US dollar on Tuesday following positive developments in peace talks in the Middle East, said Bank Muamalat Malaysia Bhd Chief Economist Dr Mohd Afzanizam Abdul Rashid.
At 10:21am, the ringgit was at RM4.1350, up 0.27% since it opened early Monday in the Asian session.
He said the US government had allowed Iran to sell its oil on the international market, which was seen as a sign that the ongoing peace talks were going well.
Following this, WTI and Brent crude prices were at US$74.29 and US$77.90 per barrel respectively.
According to him, traders are currently assessing the prospects of lower oil prices and easing inflationary pressures, but at the same time remain cautious on the possibility of an interest rate hike by the US Federal Reserve (Fed).
Domestically, Dr Mohd Afzanizam said the Finance Ministry's latest move to rationalise diesel subsidies was seen as a positive development for the country's credit standing.
He explained that the new mechanism using MyKad to channel diesel subsidies was expected to save RM2 billion.
He said the move showed the government was acting proactively in addressing current challenges while continuing to consider the impact on the people.
Therefore, he expected the ringgit to remain stable throughout today's trading session.
In early trading, the ringgit recorded a mixed performance against major and regional currencies.
Against the euro, the ringgit strengthened to 4.7345/7419 from 4.7506/7547 at Monday's close.
However, the ringgit weakened slightly against the British pound to 5.4887/4973 from 5.4850/4896, while against the Japanese yen it was almost unchanged at 2.5648/5690 from 2.5635/5658 previously.
Among ASEAN currencies, the ringgit strengthened against the Singapore dollar to 3.2030/2085 from 3.2063/2098, and rose against the Thai baht to 12.5637/5899 from 12.5919/6075.
Meanwhile, the ringgit was little changed against the Indonesian rupiah at 232.2/232.7 from 232.2/232.6 on Monday, and remained unchanged against the Philippine peso at 6.78/6.79, the same as the previous close.
