Kuala lumpur: The recent strengthening of the ringgit versus the US dollar reflects Malaysia’s underlying economic fundamentals and rising investor confidence in the country, said Sunway University economics professor Dr Yeah Kim Leng. He noted that the local currency has returned to a more normal level after being undervalued for an extended period.
According to BERNAMA News Agency, the ringgit’s appreciation is a positive indicator for the Malaysian economy, as it has been undervalued for a long time. Dr Yeah highlighted that the currency’s return to a more stable level indicates increased investor confidence and reflects the country’s economic fundamentals, such as stronger growth, a larger current account surplus, rising foreign reserves, and increased foreign direct investments.
The ringgit recently touched the 4.12 level, closing at 4.1260/1300 on November 13, 2025, close to the 4.1230 level recorded on September 27, 2024. The currency has remained broadly stable against the US dollar, with a marginal appreciation of 0.05 percent in the third quarter of 2025 and a year-to-date appreciation of 8.2 percent as of November 12, 2025, according to Bank Negara Malaysia (BNM). BNM Governor Datuk Seri Abdul Rasheed Ghaffour attributed the ringgit’s movement to both external and domestic factors.
Dr Yeah, who is also the president of the Malaysian Economic Association, noted that the US dollar’s depreciation is due to the US Federal Reserve’s signals of potential rate cuts by year-end, which benefits ASEAN countries. He pointed out that the weakening US economy, driven by higher inflation and increasing fiscal deficit and debt levels, also contributes to the greenback’s decline.
Despite these developments, Dr Yeah expressed hope for a soft landing for the US economy, which would help stabilize the global economy. He emphasized that significant risks remain in the United States, particularly concerning policy uncertainties under President Donald Trump’s administration. These uncertainties could impact investor confidence and financial market stability, but clearer signs of US economic stabilization are expected towards the end of the year following the resolution of the government shutdown.