SHAH ALAM - The ringgit’s surge to its strongest level this year has intensified discussions about the currency’s resilience as Malaysia navigates an unpredictable global financial landscape.
Malaysia’s currency has been on a steady upward trajectory since the third quarter of 2025, climbing to RM4.1150 against the US dollar on Dec 5 and its highest point this year and one of the most notable performances in Asia.
Experts attributed the positive movement to a blend of solid domestic fundamentals and evolving global conditions.
Universiti Teknologi MARA (UiTM) Puncak Alam Associate Professor Dr Norliza Che Yahya said Malaysia’s economic stability, alongside recent US interest-rate cuts, had boosted investor confidence and fuelled foreign capital inflows.
"The ringgit also benefited when the US dollar weakened in line with expectations of a more ‘loose’ monetary stance in the US, with potential rate cuts that reduce global demand for the dollar.
"This is expected to continue increasing demand for emerging market currencies such as the ringgit.
"Global confidence in Malaysian bonds has also risen, making Malaysia a more attractive investment hub compared to several regional economies that face higher political or fiscal risks," she said.
Foreign investors have purchased nearly RM16.52 billion in Malaysian bonds this year, supporting the currency’s momentum. With an eight per cent gain and nine consecutive sessions of growth, the ringgit has emerged as one of Asia’s top performers.
Norliza noted that while the currency currently benefits from strong foreign inflows and a softer US dollar, global sentiment shifts could alter its trajectory. Even so, Malaysia’s controlled inflation, stable OPR and firm economic growth provide a strong foundation for sustained stability.
"This means the ringgit’s appreciation is not merely a temporary spike but may develop into a more sustainable trend as long as fiscal and monetary policies remain strong and foreign investments continue," she said.
Despite optimism, she cautioned that the market remains vulnerable to global volatility.
"Bloomberg data also shows that approximately US$1.3 billion in foreign funds entered Malaysian government and corporate bonds in November 2025," she added, noting the country’s strong bond-market performance.
Potential US policy tightening remains a key risk. A stronger dollar following any rate hikes could pressure emerging-market currencies, including the ringgit.
Still, Norliza said the ringgit could continue strengthening early next year, supported by ongoing foreign inflows and domestic stability.
"I am also positive that the ringgit can stay in a strong phase supported by Malaysia’s stable economic structure and more prudent fiscal and monetary management," she said.
She encouraged Malaysians to take advantage of the favourable currency conditions by increasing local savings and considering domestic investment options, from fixed deposits to property and equities.