06/07/2026
Analysts expect the Malaysian Ringgit (MYR) to stage a rebound after emerging as Asia’s worst-performing currency in June. Measures to boost foreign exchange inflows and solid economic fundamentals are set to support the currency’s recovery momentum.
Royal Bank of Canada (RBC) projects that the USD/MYR exchange rate could fall to 3.95 by the end of the year, supported by Bank Negara Malaysia’s (BNM) intensified efforts to encourage domestic firms to repatriate overseas profits and convert foreign currency earnings into ringgit.
Since BNM pledged on June 24 to ramp up initiatives to attract capital inflows, the ringgit has outperformed all other Asian currencies. Strong export performance and sustained foreign demand for Malaysian local bonds have further bolstered market expectations for a continued ringgit recovery in the second half of the year.
“Robust trade surpluses and sustained inflows into ringgit-denominated debt should allow the ringgit to outperform its Asian peers,” said Abbas Keswani, Singapore-based macro strategist at RBC Capital Markets. “Policy incentives for currency conversion serve as a critical bridge between strong trade balances and improved currency performance.”
BNM’s latest measures to boost foreign currency inflows echo similar policies implemented in 2024, which lifted the ringgit after it slumped to its weakest level since 1998. The currency staged a strong turnaround following the policy intervention and emerged as Asia’s best-performing currency for the whole of 2024.
Malaysia is also benefiting from the booming artificial intelligence sector, which has driven rising demand for data center infrastructure, alongside robust global appetite for its electrical and electronic exports. In May, Malaysia’s total exports surged 45% year-on-year, with the country recording a record-high trade surplus of RM40 billion (approximately USD9.8 billion).
Improving economic fundamentals have lifted investor demand for Malaysian assets. According to latest BNM data, global funds purchased around USD2.1 billion worth of Malaysian local bonds as of June 29, marking the largest monthly inflow since May 2025.
Nevertheless, the ringgit still faces headwinds from the Federal Reserve’s hawkish stance and domestic political uncertainty. Market participants are closely monitoring upcoming state elections, which will test public support for Prime Minister Anwar Ibrahim and his ruling coalition ahead of the general election.
Key Economic Events This Week
Monday, July 6: Thailand Inflation Data
Tuesday, July 7: Japan 30-Year Bond Auction, Philippines Inflation Data, Taiwan Inflation Data
Wednesday, July 8: RBNZ Monetary Policy Decision
Thursday, July 9: BNM Monetary Policy Decision, China Inflation Data
Friday, July 10: Japan Producer Price Index (PPI)
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