The Malaysian Ringgit (MYR) has showed a mix of resilience and vulnerability recently, influenced by key developments in the local economy and international trade dynamics. Following the Bank Negara Malaysia's decision to maintain the overnight policy rate at 2.75% on September 4, 2025, analysts noted that this signals a stable inflation outlook and ongoing economic growth, which could support the MYR in the near term.
In July 2025, the central bank cut the policy rate for the first time in five years, driven primarily by concerns over global trade tensions and economic risks. This rate adjustment was a pivotal factor for the currency, and despite the recent stability in rates, experts are forecasting a potential appreciation of the MYR to a range between RM4.10 and RM4.15 against the U.S. dollar by December 2025. The anticipation of future fiscal reforms and ongoing adjustments in monetary policy are seen as positive catalysts.
The imposition of a 19% tariff on Malaysian exports by the United States effective August 1, 2025, presents a substantial challenge. While the central bank acknowledges this impact, it remains confident in Malaysia's diversified economy, highlighting the complexity of external pressures on the MYR.
Recent trading data reveals that the MYR to USD exchange rate is currently near 60-day highs at 0.2378, slightly above its three-month average of 0.2363, reflecting stable trading within a 2.3% range. The MYR to EUR rate stands at 0.2028, aligning with its three-month average, while the MYR to GBP is at 0.1755, just above the average and maintaining stability. Furthermore, the MYR to JPY is trading at 35.11, which is 1.1% above its three-month average.
In the commodities market, oil prices have been a critical factor affecting the MYR. Currently, oil is priced at $66.91, which is 2.8% below its three-month average of $68.82, exhibiting a volatile trading range. As oil is a significant export for Malaysia, fluctuations in its price can directly impact the MYR's performance against major currencies.
Overall, while recent forecasts suggest a potential MYR appreciation, external factors like U.S. tariffs and global oil price volatility continue to create an uncertain environment for the currency's trajectory.
