Kuala lumpur: Malaysia’s brisk ringgit-denominated transactions will continue to entrench the local currency as among the top 20 currencies globally, a top wealth management company official said today. SPI Asset Management managing partner Stephen Innes stated that demand for transactions in ringgit would be driven by Malaysia’s strong trading linkages, especially with China, Singapore, and other Southeast Asian economies.

According to BERNAMA News Agency, expanding usage of ringgit for currency settlements, bilateral agreements, and portfolio inflows into the domestic bond market have helped sustain demand for the local note. Innes emphasized that this will help to keep the ringgit on the global radar. The ringgit strengthened to as high as 4.1990 against the US dollar on May 5, 2025, appreciating by about 6.2 per cent from the start of the year, marking its strongest level in 2025. Currently, the local note is traded at 4.2475/2525 against the greenback.

Innes was responding to a report by Seasia Stats, which compiled data from the Society for Worldwide Interbank Financial Telecommunication (SWIFT), listing the ringgit as among the top 20 most influential currencies globally. Seasia Stats is a social media page and online platform that provides statistics and data visualizations about Southeast Asia, covering a wide range of topics including economics, demographics, culture, health, and technology.

Innes pointed out that trade, especially in the high-growth electronics and semiconductor sector, palm oil products, and energy, would stimulate demand for the ringgit. He highlighted Malaysia’s regional financial integration as a significant factor enhancing the ringgit’s global presence. The growing use of local currency settlement mechanisms, supported by bilateral agreements with Indonesia, Thailand, and China, has increased the operational footprint of the ringgit in cross-border trade. On the investment side, despite cyclical volatility, Malaysia’s bond market still attracts portfolio inflows due to its depth and relatively attractive yields.

Innes added that consistent interest helps sustain demand for the ringgit among global asset allocators. He also credited Bank Negara Malaysia’s efforts to upgrade financial infrastructure and promote digital payment connectivity for improving the ringgit’s accessibility and efficiency in international systems.

According to Seasia Stats data, the US dollar continues to dominate international transactions with a 49.68 per cent share, followed by the euro (22.24 per cent), British pound (6.51 per cent), and Japanese yen (4.03 per cent). The ringgit, along with the Hungarian forint and Thai baht, rounds out the top 20, each accounting for under 0.3 per cent of global usage. Innes remarked that while the ringgit’s inclusion may be modest in scale, it reflects a significant shift in the ringgit’s regional relevance. Although its share of global transactions remains under 0.3 per cent, its presence on the list reflects Malaysia’s strategic position within global trade and financial networks, particularly in the Asia Pacific.

Meanwhile, Bank Muamalat Malaysia Bhd chief economist Dr Mohd Afzanizam Abdul Rashid noted the Malaysian government’s efforts to improve its fiscal position have supported the ringgit’s performance. Key fiscal measures, including the increase in the sales and service tax from six per cent to eight per cent and diesel subsidy rationalization, have strengthened government finances, contributing to a 30.3 per cent increase in SST collection and reduced spending on subsidies and social assistance. Dr Mohd Afzanizam highlighted that these efforts have improved the ringgit as foreign investors were net buyers in Malaysia’s bond markets, especially the Malaysian Government Securities and Government Investment Issues. Additionally, BNM’s foreign exchange reserves rose from US$115.5 billion in January to US$120 billion at the end of June, further supporting the appreciation of the ringgit.