At 6 pm, the local currency slipped to 4.4185/4200 against the greenback from Monday’s close of 4.4120/4145.

SPI Asset Management managing partner Stephen Innes said there has been a safe-haven bid on the US dollar due to growing recession fears that have continued to weaken Asia’s foreign exchange across the board and the currencies of the G10 grouping of industrialised countries in general.

In Malaysia, he said with an unemployment rate of 3.9%, still a bit higher than pre-Covid levels and an inflation rate of only 2.8%, Bank Negara Malaysia (BNM) is under less pressure than other central banks to raise rates quickly.

“But the real policy rate is negative, and that could be excessively hurting the ringgit in the central bank’s eyes as it tries to counter the threat of feedback loop into inflation via a weaker currency.

“So, we expect BNM to hike the overnight policy rate (OPR) by 25 basis points to prevent further weakening in the local currency,” he told Bernama.

Meanwhile, the ringgit settled higher against a basket of major currencies.

The local currency rose against the British pound to 5.3168/3186 from Monday’s close of 5.3496/3526 and increased versus the euro to 4.5511/5526 from 4.6070/6096.

It also appreciated against the Japanese yen to 3.2530/2543 from 3.2578/2599 and was firmer vis-a-vis the Singapore dollar at 3.1486/1502 compared with 3.1596/1618 yesterday.