MALAYSIA — The ringgit strengthened slightly against the US dollar and Singapore dollar (S$) as of Friday (14 Jul) at noon.
As of Friday at 12 pm, the ringgit appreciated to 3.43, marking a slight increase compared to its lowest level in history against the Singapore dollar, which had dropped to a daily low of 3.50 two days ago.
The ringgit appears to be continuing its appreciation against the USD since Monday, reaching 4.52 on Friday morning, compared to 4.67 on Monday.
The ringgit traded higher against other currencies
According to the Malaysian state news agency Bernama, the ringgit also traded higher against a basket of major currencies and other ASEAN currencies.
It rose against the Japanese yen, reaching 3.2998/3040 from 3.3069/3103 at Thursday’s close.
It also appreciated against the euro, reaching 5.0976/1038 from 5.1168/1218 yesterday, and gained against the British pound, reaching 5.9593/5.9665 from 5.9861/9919 previously.
It appreciated against the Thai baht, reaching 13.1362/1578 from 13.2481/2673 yesterday, and climbed against the Philippine peso, reaching 8.34/8.36 from 8.40/8.41 previously.
Malaysians expressed concerns about the depreciation of the ringgit against SGD
Previously, Malaysians working in Singapore expressed concerns about the depreciation of the ringgit against the Singapore dollar. Some questioned the extent to which the ringgit can weaken against the SGD.
However, others remain confident that the SGD-MYR exchange rate will eventually stabilize.
The Malaysian Economy Minister clarified contrasting approaches of Malaysia and Singapore on currency management
Earlier, Malaysian Economy Minister Rafizi Ramli explained the differing currency management mechanisms between Malaysia and Singapore to achieve price stability.
He highlighted that Singapore loss around S$30.8 billion for FY22/23 to strengthen its currency as its primary method to control inflation.
In contrast, Malaysia controls inflation without the need for such extensive spending, but it still affects the currency value.
The key priority is to maintain price stability and ensure that citizens are not burdened by high-interest payments.
Semalam saya terangkan mekanisme pengurusan matawang yg berbeza antara Msia & Singapura utk capai kestabilan harga.
Singapura belanja ~RM100b utk kukuhkan matawang sbb itu saja cara mereka kawal inflasi.
Kita kawal inflasi tanpa perlu belanja begitu, ttp ada kesan kpd nilai… https://t.co/2OfyFi7qVY
— Rafizi Ramli (@rafiziramli) July 12, 2023
Rising oil prices and strong Chinese demand bolster ringgit’s strength
Rising oil prices and strong demand from China for Malaysia’s main commodities, particularly oil, are supporting the ringgit’s strength, according to an analyst.
Stephen Innes, the Managing Director of SPI Asset Management, quoted by Bernama Wednesday, Chinese authorities have implemented measures to support the real estate sector, including allowing troubled property developers one-year extensions on loans. These developments are positively impacting the trading of the ringgit.
Market expectations for a decline in US inflation may lead to a weakening of the US dollar. As a result, local exporters are likely to sell the US dollar for the ringgit, especially with indications of a stable yuan. The stability of the yuan further strengthens the case for trading the ringgit.