SGD\/MYR 2025: Ringgit Weakness & US Moves Impact

The Malaysian Ringgit, after a standout performance as Asia’s top currency in 2024, faces a complex 2025, with forecasts suggesting a weakening to 4.6 per US dollar by June before a potential recovery to 4.35 by year-end. These shifts, driven by anticipated Bank Negara Malaysia (BNM) rate cuts, US President Donald Trump’s tariffs, and broader global economic trends, will inevitably influence the SGD/MYR exchange rate—the value of the Singapore Dollar (SGD) against the Ringgit (MYR). Given the deep economic ties between Singapore and Malaysia, this article explores how these dynamics, including US monetary actions, could shape SGD/MYR, offering a detailed analysis grounded in current data and a clear perspective.

As of March 16, 2025, the SGD/MYR exchange rate stands at approximately 3.30, with one SGD buying 3.30 MYR, reflecting the Ringgit’s modest 0.6% gain against the US dollar year-to-date (from 4.46 to 4.435). The SGD, managed by the Monetary Authority of Singapore (MAS) via a trade-weighted basket, has appreciated 0.4% against the USD, trading at 1.34 SGD/USD. Meanwhile, the Ringgit strengthened 0.3% to 4.435 on March 17, paring last week’s losses, yet analysts from Credit Agricole and Malayan Banking predict a mid-year dip to 4.6 due to trade and policy pressures.

The Ringgit’s anticipated weakening to 4.6 per USD by June 2025 stems from multiple pressures, notably a potential 25 basis point BNM rate cut, fully priced in by traders within 12 months. This shift, up from a two-thirds probability earlier in March, reflects concerns over slowing global trade and moderated GDP growth (4.8% in Q4 2024, down from 5.9%). A cut from the current 3.00% policy rate would reduce the Ringgit’s yield appeal, likely pushing SGD/MYR upward to around 3.43 if the SGD holds at 1.34 USD—a 3.9% rise signaling Ringgit depreciation.

US Federal Reserve actions offer a counterweight, with recession fears—US GDP at 2.1% in Q4 2024 and inflation at 2.5%—fueling bets on a 50 basis point cut by December 2025. A weaker USD (potentially 1.38 SGD/USD) could lift the Ringgit to 4.35, as forecasted by Maybank’s Saktiandi Supaat, narrowing SGD/MYR to around 3.15. This recovery aligns with fading US exceptionalism and supports Malaysia’s export competitiveness, easing earlier tariff strains.

Singapore and Malaysia’s SGD 110 billion bilateral trade in 2024 underscores their interdependence, with Malaysia as Singapore’s second-largest partner. A weaker Ringgit could boost Malaysian exports to Singapore (e.g., SGD 7 billion in electronics), but costlier imports for Singaporean firms might offset this, stabilizing SGD/MYR. Historical Ringgit weakness in Q2 (1.5% average decline over a decade) aligns with the 4.6 forecast, while Q4 recoveries (1% gain) support a late-2025 rebound, influencing SGD/MYR cyclically.

The Ringgit’s swings will ripple across assets, impacting SGD/MYR dynamics. Malaysian export stocks (e.g., Inari Amertron) could gain in SGD terms from a weaker MYR, though economic weakness might drag the FTSE Bursa Malaysia KLCI (1,540 in March) lower. Singaporean electronics firms like Venture Corporation may see margin pressure from costlier Malaysian inputs, tempered by SGD strength. MYR bonds (10-year MGS at 3.65%) may lose appeal, raising yields, while SGD bonds (2.8% for 10-year SGS) remain stable.

I contend that SGD/MYR will climb to 3.40–3.45 by June 2025 as the Ringgit weakens under tariffs and rate cuts—Malaysia’s semiconductor reliance and seasonal trends make this likely. The SGD’s stability, backed by reserves of $350 billion and MAS’s steady hand, will drive this shift. Yet, a Ringgit rebound to 4.35, fueled by Fed cuts and Malaysia’s $115 billion reserves, could pull SGD/MYR back to 3.20–3.25 by year-end, a scenario I favor given global easing potential.

​The SGD/MYR’s 2025 path mirrors the Ringgit’s broader challenges and Singapore’s steady counterpoint. A mid-year spike reflects immediate pressures, but US monetary easing and regional ties could stabilize it later. For stakeholders, this duality demands agility—hedging SGD/MYR exposure now, while positioning for a potential Ringgit uptick. Monitoring Fed moves, Trump’s trade policies, and China’s economy will be key, as these will shape not just SGD/MYR, but Southeast Asia’s financial landscape.