Ringgit Stays Flat Against US Dollar Amid Strong American Manufacturing Data

The Malaysian ringgit opened flat against the US dollar on Tuesday, trading at 4.0935/4.1000 at 8am. This performance follows the previous day’s close of 4.0935/4.0975, even as the local currency posted gains against several other major global currencies.

According to the original publisher, the market movement follows the latest data from the US Institute for Supply Management (ISM) Manufacturing Purchasing Managers’ Index (PMI). The index reached 55.6 points in July, exceeding the consensus estimate of 54.0 points. Bank Muamalat Malaysia Bhd chief economist Afzanizam Rashid stated that this surprise upside reinforces market expectations for a US interest rate hike.

The survey highlighted that US firms remain resilient despite challenges such as elevated energy prices and import tariffs. Notably, sectors linked to technology and artificial intelligence investment reported the most positive responses, suggesting that capital expenditure in these areas continues to drive industrial sentiment. However, companies remain cautious as freight costs stay high, prompting a broader focus on operational efficiency to protect profit margins.

While the US Dollar Index is currently holding at 99.952 points, crude oil prices have experienced a decline due to optimism surrounding potential negotiations between the US and Iran regarding the Strait of Hormuz. Consequently, analysts anticipate the ringgit will likely maintain a narrow trading range between RM4.08 and RM4.10 throughout the day.

For Malaysian businesses and investors, these fluctuations reflect the ongoing sensitivity of the local currency to US economic indicators and geopolitical shifts. As the ringgit maintains a tight range, market participants continue to monitor how US monetary policy shifts and global supply chain costs impact the broader economic landscape for the remainder of the week.