US Dollar Strength Supports Global Currency Markets

Malaysia’s ringgit stayed broadly stable in July, weakening only 0.05% to RM4.086 per US dollar despite a softer dollar that fell 1.3% month‑on‑month. Analysts said near‑term pressure could arise from market volatility, geopolitical uncertainty and expectations of further US Federal Reserve rate hikes.

A Reuters poll of about 60 FX strategists found the US dollar is expected to hold firm in the coming months before weakening later in the year. Nearly 95% said recent Japanese yen interventions would not sustainably curb the yen’s weakness, and most added that the Bank of Japan would need to raise rates to have a lasting impact. The poll also noted that a strong US economy may prompt the Federal Reserve to raise rates sooner to contain inflation linked to the US‑Israeli conflict with Iran. The euro is projected to hold around $1.15 in the next three months before modestly strengthening.