Ringgit Malaysia rose to a new 14-year high of RM2.9432/USD 1 on last Wednesday, July 27. In the other words, Malaysian just needs to pay RM2.94 to buy US$ 1. The appreciation of ringgit is due to the stronger economic fundamentals and better economic growth prospect.
I believe that the value of ringgit would further increase. This is because the US debt compared to GDP was still rising despite the end of the QE II. Besides that, there is speculation that Bank Negara Malaysia will raise the overnight policy rate (OPR) to curb inflation also. This will strengthen our ringgit value in the next couple months.
The rising value of Ringgit has made buying items off the Internet much more cheaper. Recently, the ringgit closed at a new 13 year high against US dollar with the exchange rate of 2.96. It has taken more than a decade to strengthen below 3.00 against US dollar. Obviously, it is fully depend on US economy which brightened the outlook for exports.
As we can see that while the ringgit has strengthened against US dollar, it has weakened against euro, Australian dollar, pound and yen. If compared to last year 2010, the Ringgit Malaysia is one of Asia’s best performing currencies as it has appreciated by 9.2% against the US dollar, 11.94% against the British pound and 15.73% against the euro.