Ringgit opens higher against US dollar amid US and Japan rate‑hike expectations

KUALA LUMPUR, Sept 9 — The Malaysian ringgit began the day on a stronger note against the US dollar on September 9 as global markets analyzed the expectations of potential interest rate hikes in the United States and Japan. By 8 am, the local currency had climbed to 4.0560/0635 against the greenback, marking an improvement from its previous close of 4.0605/0640.

Dr Mohd Afzanizam Abdul Rashid, chief economist at Bank Muamalat Malaysia Bhd, attributed the rise to higher US Treasury yields, which indicated the Federal Reserve might raise interest rates at the upcoming Federal Open Market Committee (FOMC) meeting on September 15-16. "The US Treasury notes auction for three-month and six-month bills yielded higher at 3.80 per cent and 3.89 per cent, respectively," he pointed out to Bernama.

In addition, the Japanese yen strengthened against the US dollar to 153.53 yen, reflecting growing expectations of a potential rate increase by the Bank of Japan (BOJ). This was supported by Japan's healthier economy, with GDP growing 1.4 per cent quarter-on-quarter in the second quarter of 2026, surpassing forecasts of 1.1 per cent.

Furthermore, wage growth in Japan accelerated to 4.7 per cent year-on-year in July, exceeding market expectations of 3.9 per cent. However, Quintex Intel global strategist Stephen Innes pointed out that the anticipated Fed rate hike was seen as more of an insurance measure rather than the onset of a prolonged tightening cycle. Innes added that currency markets treated the expected move as an insurance hike, rather than the beginning of a sustained tightening phase.

The ringgit traded lower against most major currencies, weakening against the Japanese yen to 2.6437/6488, falling against the euro to 4.7167/7254, and easing against the British pound to 5.4934/5036. Despite these declines, the ringgit performed better against regional currencies, rising against the Thai baht to 12.3241/3529, strengthening against the Philippine peso to 6.47/6.49, and increasing against the Indonesian rupiah to 230.0/230.5. However, it weakened against the Singapore dollar to 3.2081/2143.