From the beginning of 2026 until June 22, the ringgit recorded a slight decline of 2.1% against the US dollar, while the nominal effective exchange rate declined 1.6%
PETALING JAYA: The ringgit has slipped 2.1% against the US dollar this year, although Malaysia’s strong economic fundamentals continue to support the currency, Deputy Finance Minister Liew Chin Tong told the Dewan Rakyat.
He said the ringgit began 2026 on a strong note, rising 4.3% against the US dollar in the first two months, while the nominal effective exchange rate increased by 3.2%.
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However, Liew said tensions in the Middle East at the end of February had affected global financial and currency markets, including the ringgit.
“From the beginning of 2026 until June 22, the ringgit recorded a slight decline of 2.1% against the US dollar, while the nominal effective exchange rate declined 1.6%,” he said.
He was replying to Datuk Suhaili Abdul Rahman (Independent–Labuan), who asked about the main factors influencing recent ringgit movements and whether the currency was supported by sustainable economic fundamentals.
In response to a supplementary question on the impact of the ringgit on exports, Liew said Malaysia’s export performance remained strong despite currency fluctuations, particularly in the technology and semiconductor sectors.
“The value of the ringgit is a factor, but it does not necessarily disrupt export performance,” he said.
He added that exports, especially in the technology sector, had not been significantly affected by currency movements.
Liew said the ringgit would continue to be influenced by external factors, including developments in the Middle East conflict and expectations over US Federal Reserve interest rate policy.
However, he stressed that the currency remained supported by Malaysia’s economic fundamentals, including ongoing structural reforms.
He said Malaysia’s economy grew 5.4% in the first quarter of 2026, while inflation remained moderate at 1.6%.
For the full year, the economy is projected to grow between 4% and 5%, with inflation expected to remain between 1.5% and 2.5%.
Liew added that export performance continued to support the ringgit, with exports rising 45.3% in May — the strongest monthly performance in three years — while imports grew 14.1% over the same period.
He said the government and Bank Negara Malaysia would continue coordinated efforts to encourage two-way flows in the domestic foreign exchange market.
