Innes said that market sentiment has skewed towards the positive side in the midweek trading session, with the budget announcement later this week anticipated to be fiscally responsible, contributing to the ringgit’s recovery.

“The ringgit showed notable strength today, reflecting its sensitivity to the US 10-year Treasury yields, which have retreated to around 4.02% after peaking at 4.10% earlier.

“This shift signals a bullish outlook for the ringgit, as market participants also appear to believe that the hawkish stance from the Federal Reserve (Fed), driven by strong US economic data, may have reached its peak,” he told Bernama.

Furthermore, he said that the narrowing of the interest rate differential between the Malaysian Government Securities and US Treasuries is also playing a crucial role in boosting the ringgit.

At 6pm, the local currency improved to 4.2945/4.2995 versus the greenback from yesterday’s close of 4.3080/4.3120.

At the close, the ringgit was higher against a basket of major currencies.

It rose against the euro to 4.6780/4.6834 from 4.7013/4.7057 at yesterday’s close, surged against the British pound to 5.5889/5.5954 from 5.6357/5.6410 and increased vis-a-vis the Japanese yen to 2.8772/2.8807 from 2.8928/2.8957 previously.

The local currency was traded mixed versus Asean currencies.

It appreciated against the Singapore dollar to 3.2800/3.2841 from 3.2928/3.2961 yesterday and advanced versus the Philippine peso to 7.43/7.45 from 7.44/7.46 previously.

Meanwhile, it depreciated against the Thai baht to 12.9329/12.9546 from 12.9121/12.9303 yesterday and weakened against the Indonesian rupiah to 276.8/277.3 compared to 276.3/276.7 previously.