Outlook
The Malaysian Ringgit faces a supportive near-term backdrop as the US dollar softens on Fed rate cuts, Malaysia’s economy shows resilience, and fiscal consolidation progresses. Sustained foreign demand and steady oil prices add to the impulse. Risks include a renewed US rate hawkish tilt or a shift in global risk appetite that could weigh on MYR gains.
Key drivers
- US Federal Reserve's rate cuts have weakened the US dollar, providing a lift to the MYR.
- Malaysia's economy posted 5.2% GDP growth in Q3 2025, driven by domestic consumption, exports and strong sectors like mining and construction.
- Fiscal consolidation aims to reduce the deficit to 3.5% of GDP by 2026, improving financial stability.
- Ongoing FDI to technology and green energy supports MYR via stronger external demand.
- Oil price strength (Oil/USD around 67.91, 7.1% above the 3‑month average) adds a positive tailwind for energy-related sectors and the broader economy.
Range
MYR/USD is at a 7-day low near 0.2534, about 3.1% above its 3‑month average of 0.2457, with a 6.6% trading range from 0.2395 to 0.2552. MYR/EUR at 0.2144 is 2.0% above its 3‑month average of 0.2101, trading in a range of 0.2070–0.2155. MYR/GBP at 0.1861 is 1.5% above its 3‑month average of 0.1834, within 0.1813–0.1871. MYR/JPY at 39.83 is 3.8% above its 3‑month average of 38.38, within a 36.77–39.91 range. Oil price/USD at 67.91 is 7.1% above its 3‑month average of 63.42, trading in a 59.04–69.09 range.
What could change it
- A renewed or sharper US rate path (hawkish shift) or stronger US data could lift the dollar and weigh on MYR.
- A sharp fall in oil prices or softer global demand could dampen MYR momentum.
- Domestic policy surprises or political developments in Malaysia could alter risk premiums.
- A change in global risk appetite or liquidity conditions could impact cross-rates and capital flows into Malaysia.
