KUALA LUMPUR, 29 December 2025 — The Malaysian ringgit (MYR) opened firmer on Monday, extending its positive trend for a 12th consecutive trading session, as a weaker U.S. dollar, improved market sentiment and supportive external conditions underpinned demand for the currency, market participants said.
In early trading, the ringgit strengthened against the U.S. dollar, trading around RM4.0200–RM4.0250 per USD, reflecting continued confidence in Malaysia’s economic resilience and growing optimism about regional currency movements as the year draws to a close. This marked the longest sustained daily rally for the ringgit in recent years, highlighting reduced volatility and favourable risk appetite among investors.
Drivers Behind the Ringgit’s Strength
• Weaker U.S. Dollar:
The greenback’s recent softness, influenced by expectations of slower U.S. rate hikes and shifting monetary policy outlooks, has eased upward pressure on emerging market currencies, including the ringgit. As the dollar loses ground, investors often pivot to higher-yielding, risk-sensitive currencies.
• Positive External Sentiment:
Global markets entered the week with improved risk sentiment following a series of solid economic data points and reduced geopolitical uncertainty in some regions. This boosted demand for emerging market assets and currency pairs like MYR/USD.
• Strong Malaysia Trade Performance:
Malaysia’s robust external trade performance, with exports reaching RM1.45 trillion through November and a notable trade surplus, has further bolstered confidence in the ringgit’s fundamentals. Healthy trade balances often support a stronger local currency by increasing foreign exchange inflows from goods and services exports.
Despite the positive run, some analysts caution that the ringgit’s gains could be tested if liquidity thins in the upcoming holiday period or if major macroeconomic data surprises push investor positioning back into safe-haven assets like the U.S. dollar.
Outlook and Market Commentary
Currency strategists say the sustained rally is unusual but reflective of broader emerging market currency cycles where risk appetite, commodity prices and global monetary policy expectations intersect to drive momentum. “A 12-day winning streak for the ringgit points to firm support levels and sustained investor interest that could carry into early 2026,” said one FX analyst, adding that key near-term resistance remains around RM4.00–RM4.01 per dollar.
The Ledger Asia View:
The ringgit’s extended rally highlights Malaysia’s improving macroeconomic signals and the growing role of external drivers, such as U.S. monetary policy expectations and global trade strength, in shaping currency dynamics. For ASEAN FX watchers, the persistent uptrend reflects a broader pattern of positive sentiment toward emerging Asian currencies, even as market participants brace for potential volatility in January once liquidity normalises after the holiday season.
