Ringgit Jumps To RM4.04 Against US Dollar As US-Iran Peace Deal Boosts Market Sentiment

KUALA LUMPUR,June,2026 – The ringgit extended its upward momentum on Monday morning, opening stronger against the US dollar and other major currencies as investors reacted positively to signs of easing geopolitical tensions in the Middle East.

At 8am, the local note rose to 4.0430/0500 against the US dollar, compared with last Friday’s close of 4.0555/0600. The stronger opening placed the ringgit near the RM4.04 level, supported by improving global risk sentiment following developments in the United States-Iran peace talks.

Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid said market sentiment improved after news that the Strait of Hormuz could be reopened following an agreement between the United States and Iran on a peace deal expected to be signed on June 19.

The Strait of Hormuz is one of the world’s most important oil and gas shipping routes. Any improvement in security around the waterway is closely watched by global markets because disruptions can affect crude oil prices, inflation expectations and investor confidence.

According to Reuters, oil prices fell sharply after the United States and Iran reached an initial deal to end the war and resume traffic through the Strait of Hormuz. Brent crude futures dropped 4.10 per cent to US$83.75 per barrel, while US West Texas Intermediate fell 4.72 per cent to US$80.87.

The fall in oil prices helped reduce concerns over energy supply disruption. When geopolitical risk eases and oil prices decline, investors often move away from safe-haven assets and return to emerging market currencies, including the ringgit.

Dr Mohd Afzanizam said WTI and Brent crude had already fallen by more than four per cent, with Brent crude trading around US$83.83 per barrel. He added that the ringgit appears to be moving toward the RM4.00 level against the US dollar, although this may not happen immediately.

He also said a sub-RM4.00 level would be consistent with the ringgit’s fair value, supported by Malaysia’s current macroeconomic conditions and resilient economic growth.

The ringgit’s movement reflects how global geopolitical events can directly affect Malaysia’s currency market. Although Malaysia is not directly involved in the US-Iran conflict, changes in oil prices, global risk appetite and US dollar demand can influence the ringgit.

The US-Iran peace framework has become a major driver of market sentiment. Reuters reported that both sides are expected to sign a memorandum of understanding in Switzerland on Friday, while Pakistan has played a mediation role in the talks.

Under the preliminary agreement, the Strait of Hormuz is expected to reopen, while further negotiations on a final agreement are expected over the next 60 days. However, analysts remain cautious because the details of the agreement and the speed of implementation are still being monitored.

The Guardian also reported that the exact terms of the US-Iran agreement remain unclear, while Iran’s Mehr state news agency said the reopening of the Strait of Hormuz could take place within 30 days under Iranian arrangements.

For currency markets, the key impact is the reduction of uncertainty. When investors believe that energy shipments may resume and oil prices may stabilise, they become more willing to hold risk-sensitive assets.

This is positive for the ringgit because the local currency often benefits when the US dollar weakens and global investors become more confident toward Asian and emerging market assets.

At Monday’s opening, the ringgit also strengthened against a basket of major currencies. It appreciated against the Japanese yen to 2.5275/5320 from 2.5334/5364, rose against the British pound to 5.4374/4468 from 5.4429/4489, and improved against the euro to 4.6911/6992 from 4.6979/7031.

The local note also performed better against regional currencies. It gained against the Singapore dollar to 3.1554/1611 from 3.1602/1640, improved against the Thai baht to 12.4015/4298 from 12.4105/4288, and recovered against the Indonesian rupiah to 226.3/226.8 from 227.0/227.4.

The ringgit also strengthened against the Philippine peso, rising to 6.65/6.66 from 6.67/6.68 previously.

The broad-based strengthening shows that the ringgit’s gains were not limited to the US dollar. Instead, the currency improved across several major and regional pairs, suggesting stronger market confidence toward Malaysia’s financial outlook.

Lower oil prices can have mixed implications for Malaysia. As an oil and gas producer, Malaysia can benefit from higher energy prices through export revenue, but lower oil prices can also ease inflationary pressure and reduce global economic risks.

For the ringgit, the immediate effect appears positive because lower geopolitical tension has weakened demand for the safe-haven US dollar and improved appetite for regional currencies.

The currency market is also watching the upcoming US Federal Reserve policy meeting. Any signal on US interest rates could influence the direction of the US dollar and affect whether the ringgit can continue its advance toward the RM4.00 level.

If the US dollar weakens further and the US-Iran peace framework remains intact, the ringgit may continue to attract support. However, renewed uncertainty over the agreement, oil supply risks or hawkish US interest-rate signals could limit further gains.

For businesses, a stronger ringgit can help reduce import costs, especially for companies that purchase raw materials, equipment or goods priced in US dollars. It may also help ease pressure on imported inflation.

For exporters, however, a stronger ringgit can reduce foreign-exchange advantages when converting overseas earnings back into local currency. This means the currency’s movement will have different effects across sectors.

In the short term, market sentiment will likely remain highly headline-driven. Investors will continue watching whether the US-Iran agreement is officially signed, whether the Strait of Hormuz reopens smoothly, and whether oil prices remain under control.

the ringgit’s jump to around RM4.04 against the US dollar reflects improving global risk sentiment after the US-Iran peace breakthrough. With oil prices easing and the US dollar under pressure, the local currency has gained fresh momentum.

However, the next phase will depend on whether the diplomatic progress between Washington and Tehran translates into real implementation. If the deal holds and global market confidence improves, the ringgit may continue moving closer to the psychologically important RM4.00 level.