Recent developments suggest a mixed outlook for the Malaysian Ringgit (MYR) against the Singapore Dollar (SGD). As of early September 2025, the MYR has appreciated, reaching 30-day highs near 0.3055, which stands 0.8% above its 3-month average of 0.3031. This upward movement has occurred within a relatively stable range of 0.2991 to 0.3058, indicating market stability.
The Bank Negara Malaysia (BNM) maintained the overnight policy rate at 2.75%, following a 25 basis point cut in July due to global trade tensions and growth risks. Analysts foresee the MYR appreciating against the U.S. dollar, forecasting a potential range of RM4.10 to RM4.15 by December 2025, driven by an expectation of ongoing rate adjustments and fiscal reforms.
Conversely, concerns remain due to the U.S. imposing a 19% tariff on Malaysian exports effective August 2025, likely impacting Malaysia's export-driven economy. However, BNM believes the diversified nature of the Malaysian economy will mitigate some negative impacts.
On the other side of the equation, the Singapore Dollar (SGD) has seen its monetary policy remain unchanged as the Monetary Authority of Singapore (MAS) opted to maintain its current settings following a surprising 1.4% quarter-on-quarter GDP growth in Q2 2025. This decision reflects a response to easing trade tensions and improvements in financial conditions. Core inflation has also declined significantly, adding further rationale for maintaining existing policies.
Economists are divided regarding future MAS actions. Some anticipate continued stability in monetary policy, while others expect potential easing to address a possible negative output gap in 2026.
Oil prices, a significant factor affecting the MYR, are currently at $66.99, approximately 2.9% below their 3-month average. The volatility in the oil market, with a recent range of $65.50 to $78.85, introduces additional uncertainty for MYR projections.
In conclusion, while the MYR shows signs of short-term strength against the SGD, external pressures such as U.S. tariffs and fluctuating oil prices could create challenges ahead. Currency analysts recommend keeping a close eye on these developments, especially for businesses and individuals engaging in international transactions.
