The ringgit also faces headwinds from seven straight months of exports decline through September, partly due to a slowdown in China, its largest trading partner. Capital flows have also hurt sentiment as global funds sold US$324 million ($444.8 million) of Malaysian stocks in October, the first outflow in four months. Ringgit bonds also saw two straight months of net foreign withdrawals as of September.
Singapore’s dollar surged to an all-time high against the Malaysian ringgit as the latter was weighed down by weaker exports and its widening rate differential with the US.
The Singaporean dollar rose as high as 3.4826 versus the ringgit on Friday, Oct 20, 2023. That’s because the local dollar was supported by previous rounds of policy tightening. Bank Negara Malaysia on the other hand paused interest-rate hikes in July, which has put its overnight policy rate at a record discount relative to the upper bound of the Federal Reserve funding rate.
