MBSB Investment Bank Bhd (MBSB IB) said the ringgit’s appreciation was supported by the latest domestic economic data, which showed stronger-than-expected industrial production and distributive trade, as well as resilient trade performance.

“Moving forward, we project that the ringgit will remain on a strengthening trend in 2026,” MBSB IB said in a research note.

Malacca Securities Sdn Bhd noted that the local currency was further supported by a weaker greenback amid expectations of more US interest rate cuts in 2026.

“Following the (earlier) US rate cuts, foreign funds may eye Malaysia for bargain-hunting. The ringgit’s upside-biased environment is expected to shape market direction,” it said.

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

At 6pm, the local currency climbed to 4.0515/4.0560 versus the greenback from Wednesday’s close of 4.0580/4.0620.

Markets were closed on Thursday for New Year’s Day.

It appreciated against the Japanese yen to 2.5817/2.5848 from 2.5907/2.5934 on Wednesday, was firmer versus the British pound at 5.4509/5.4569 from 5.4531/5.4585, and gained vis-à-vis the euro to 4.7488/4.7540 from 4.7617/4.7664 previously.

However, the local note was mixed against Asean peers.

It rose against the Singapore dollar to 3.1502/3.1540 from 3.1550/3.1584 and strengthened vis-à-vis the Indonesian rupiah to 242.2/242.6 from 243.2/243.6.

It eased versus the Thai baht to 12.8996/12.9201 from 12.8560/12.8756, and was flat against the Philippine peso at 6.88/6.89 from 6.88/6.90 previously.