Anticipation Builds for BNM Policy Decision to Guide Ringgit
The Malaysian ringgit is projected to sustain its positive trading momentum into the coming week, with the central focus being the eagerly awaited Bank Negara Malaysia (BNM) Monetary Policy Committee’s (MPC) decision on the Overnight Policy Rate (OPR) scheduled for November 6.
This announcement regarding the BNM policy is the single most important highlight that market participants are tracking, as it will provide critical insight into the central bank’s current assessment of the nation’s economic health and its future monetary policy direction.
Dr. Mohd Afzanizam Abdul Rashid, the chief economist at Bank Muamalat Malaysia Bhd, forecasts that the ringgit will likely trade within a tight range of 4.18 to 4.20 against the US dollar throughout the next week.
The MPC’s decision is highly anticipated to clarify how BNM interprets the recent economic performance, which will consequently shape its official monetary policy stance for the near term.
Economists are broadly penciling in a consensus expectation for the OPR to be maintained at its current level of 2.75 percent.
This outlook is substantially supported by the continued resilience of the Malaysian economy, which recently demonstrated robust performance with an advance estimate for the third quarter of 2025 Gross Domestic Product (GDP) growth coming in at a healthy 5.2 percent.
This solid GDP figure provides ample justification for the central bank to keep its monetary policy steady, avoiding any immediate need for interest rate adjustments.
The ringgit’s performance against the US dollar and other major currencies next week will largely hinge on the tone and forward guidance provided in the official BNM policy statement.
Ringgit Shows Broad Strength Against Global Currencies
The Malaysian ringgit demonstrated significant broad-based strength during the past week, closing marginally higher against the US dollar at 4.1860/1930, an improvement from its closing of 4.2210/2255 in the previous week.
This firmer trend against the greenback contributed to the overall positive sentiment surrounding the local note.
Beyond the US dollar, the ringgit also recorded gains when measured against a basket of other major international currencies, reinforcing its stable position in the global foreign exchange market.
For instance, the ringgit appreciated notably against the Japanese yen, firming to 2.7162/7210 from 2.7592/7623 the week prior.
It also gained ground against the British pound, trading stronger at 5.5025/5117 compared to 5.6232/6292, and strengthened convincingly versus the euro, closing at 4.8453/8534 from 4.9010/9062 at the previous week’s close.
This performance reflects confidence in Malaysia’s economic fundamentals, which is a key factor considered by the central bank when setting its monetary policy.
Although the upcoming BNM policy decision on the OPR is the main domestic driver, global currency flows, risk appetite, and external factors like US monetary policy expectations continue to influence the ringgit’s daily movements.
The maintenance of the OPR, as widely expected, should help to keep the interest rate differential stable, which is crucial for maintaining the local currency’s appeal to foreign investors.
Mixed Performance Recorded Against Regional ASEAN Peers
In its trading against its regional ASEAN counterparts, the ringgit’s performance was generally positive, though it exhibited a few mixed results.
The currency gained strength against the Singapore dollar, improving to 3.2185/2241 from 3.2484/2521, a key pair given the strong bilateral trade and financial links between the two nations.
It further enhanced its value versus the Indonesian rupiah, trading at 251.7/252.2 compared to the previous close of 254.2/254.6.
The ringgit also expanded its position against the Philippine peso, closing at 7.12/7.14 from 7.20/7.21, reflecting the divergent economic outlooks and capital flows within Southeast Asia.
However, the ringgit did experience a marginal slip against one regional currency, weakening slightly against the Thai baht to 12.9429/9702 from 12.8768/8952 in the preceding week.
The overall appreciation against most of its regional trading partners suggests that the market views the Malaysian economy favorably relative to much of the wider ASEAN region, a perception which the upcoming BNM policy decision will either validate or challenge.
Analysts expect that if the central bank confirms the market’s resilient view of the economy and holds the OPR, the ringgit is likely to consolidate its recent gains against most peers, as stability in monetary policy is often attractive to investors seeking regional safe havens.
The continued strong performance of the Malaysian economy, particularly the positive GDP growth rate, serves as the fundamental basis for this market confidence.
