The Malaysian Ringgit (MYR) is currently navigating a turbulent landscape following the recent announcement of a 24% tariff on Malaysian imports by U.S. President Donald Trump. This act is part of a broader trade conflict that has raised concerns about international trade dynamics and regional currency stability. Notably, Malaysia has chosen not to retaliate, opting instead for diplomatic engagement. Malaysian Prime Minister Anwar Ibrahim indicated a commitment to coordinating a regional response to these tariffs, despite refuting claims of high tariffs imposed on U.S. goods.
In recent trading, the MYR has shown vulnerabilities, with the exchange rate against the U.S. dollar reaching 0.2358, marking a 7-day low and standing 1.0% above its 3-month average of 0.2334. This range reflects a modest volatility from 0.2227 to 0.2382. Similarly, against the Euro, the MYR at 0.2011 is 1.6% below its 3-month average. The currency pair has maintained relative stability, trading within a range from 0.1988 to 0.2102.
The situation is slightly more favorable for the MYR against the British pound, with the currency touching a 14-day high at 0.1736, aligned closely with its 3-month average and demonstrating a stable range between 0.1705 and 0.1788. In contrast, the MYR has seen strength against the Japanese yen, reaching 90-day highs at 34.63, which is 2.8% above its 3-month average, supporting a trading range from 32.17 to 34.63.
Economic analysts assert that the overall outlook for emerging Asian currencies is deteriorating, particularly as fears of an escalating global trade war intensify. This sentiment is echoed by a decline in regional currencies such as the Thai baht and South Korean won, which have fallen around 2% over the past week, reflecting a diminished risk appetite among investors.
The recent surge in oil prices, with crude moving to $70.15—4.8% above its 3-month average—can also influence the MYR, which benefits from higher oil prices given Malaysia's status as a net oil exporter. However, the volatility in oil prices, which have fluctuated dramatically in recent months from $60.14 to $78.85, adds another layer of uncertainty for the MYR's trajectory in the near future. Therefore, stakeholders should closely monitor both international trade developments and oil market trends as they navigate their financial strategies involving the MYR.
