Why Malaysian ringgit dives to 10-month low against Singapore dollar
The Malaysian ringgit’s recent drop to a 10-month low against the Singapore dollar reflects a short-term market adjustment and Singapore’s strong currency policy rather than a deterioration in Malaysia’s economic fundamentals, analysts say.
The Malaysian ringgit has fallen to its lowest level in 10 months against the Singapore dollar, according to foreign exchange strategist Chris Wong of OCBC. Wong believes the recent weakness is a short-term market adjustment driven by higher oil prices, stronger U.S. Treasury yields, and risk aversion among investors.
Higher U.S. yields make U.S. assets more appealing, dragging down emerging-market currencies like the ringgit. Domestic fundamentals, however, remain relatively supportive, with growth, investment and the external sector still performing well.
The ringgit weakened to 3.22 per Singapore dollar on Wednesday, marking a 1.86% decline against the Singapore dollar so far in 2026, after a 3.77% gain last year. Singapore's Monetary Authority tightened monetary policy twice in 2026, while Malaysia's central bank's stance has been more growth-oriented.
Zavier Wong of trading platform eToro points to uncertainty surrounding Malaysia's plans to fund fuel subsidies as a factor behind foreign outflows from Malaysian assets. The subsidy bill is pulling money out of Malaysian equities due to its uncertain funding and potential cost.
Investors are waiting for clarity on budget details to move beyond speculation. Once the budget is revealed on Oct. 9, the ringgit's pressure may ease. The Singapore dollar's strength is supported by the Monetary Authority's exchange-rate framework, which manages its value against a basket of major trading currencies, as well as positive sentiment toward Singapore equities.
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