Ringgit Among Region’s Top-Performing Currencies As Strong Investment Inflows Support Malaysia’s Economy, Says Amir Hamzah

KUALA LUMPUR,June,2026 – The ringgit remains one of the region’s top-performing currencies this year, supported by strong investment inflows, positive economic fundamentals and continued investor confidence in Malaysia, according to Finance Minister II Datuk Seri Amir Hamzah Azizan.

Speaking during a session titled “Balancing Fiscal Focus with External Risks” at the Invest Malaysia Kuala Lumpur Conference 2026, Amir Hamzah said the local currency continued to record positive gains against the US dollar on a year-to-date basis. He added that the ringgit had also performed favourably when compared with several other regional and global currencies.

Amir Hamzah said the ringgit’s performance should not be viewed only through its movement against the US dollar. Instead, he stressed that Malaysia’s currency position must also be assessed against a wider basket of currencies, where the ringgit has remained relatively stronger than many others.

According to him, the ringgit’s resilience is being supported by Malaysia’s solid economic base, particularly strong inflows of foreign direct investment and domestic direct investment. He said continued investment activity has helped provide demand support for the local currency, even as global markets face volatility and uncertainty.

The Finance Minister II also pointed to Malaysia’s approved investment performance as evidence of investor confidence. He referred to the latest figures from the Malaysian Investment Development Authority, which showed that Malaysia secured RM92.8 billion in approved investments in the first quarter of 2026.

According to MIDA, the approved investments for January to March 2026 involved 1,249 projects across the services, manufacturing and primary sectors. These projects are expected to create 50,226 new jobs, representing a 46.7 percent increase from the same period last year.

Foreign investments accounted for RM56.2 billion, or 60.5 percent of total approved investments, while domestic investments rose 13 percent year-on-year to RM36.6 billion, making up 39.5 percent of total approvals. MIDA said this reflected growing confidence among Malaysian businesses as well as continued foreign investor interest in the country.

Amir Hamzah noted that domestic investment has remained robust, with DDI slightly exceeding FDI in certain areas of the overall investment landscape. He said local investors are also playing an important role in supporting economic growth by identifying and expanding into strategic sectors.

Investment momentum has increasingly aligned with Malaysia’s high-growth priorities, including semiconductors, data centres and artificial intelligence. Amir Hamzah said these sectors are helping strengthen demand for the ringgit because they continue to attract capital, create jobs and deepen Malaysia’s role in regional technology supply chains.

MIDA’s Q1 2026 data also showed that Japan emerged as Malaysia’s largest foreign investor during the quarter, with RM21.5 billion in approved investments. China and the United States each recorded RM10.1 billion, followed by Singapore at RM6.7 billion and Thailand at RM2.5 billion.

The strong investment inflows come as Malaysia continues to position itself as a regional hub for digital infrastructure, advanced manufacturing and technology-driven industries. MIDA said 93.6 percent of Japanese approved investments in Q1 2026 were channelled into digital transformation activities, underscoring Malaysia’s growing role in high-technology and digital supply chains.

This investment momentum is significant for the ringgit because foreign and domestic capital inflows can increase demand for the local currency. When companies invest in Malaysia, they often require ringgit for local operations, wages, construction, equipment, services and business expansion, which can help support the currency over time.

At the same time, Malaysia’s economic appeal has been reinforced by wider investor interest in the country’s financial assets. Reuters reported earlier this year that global investors had been increasing exposure to Malaysia, citing stable growth, strong currency performance and Malaysia’s position as a beneficiary of AI-linked data centre and semiconductor investments.

However, Amir Hamzah acknowledged that currency markets will continue to face volatility due to external developments. Global uncertainty, geopolitical tensions, changes in US interest rate expectations and shifts in investor sentiment can still affect exchange rates, including the ringgit.

Despite these risks, he said Malaysia’s priority is to continue strengthening the fundamentals of the economy. He stressed that the government remains focused on ensuring that the economy operates on a solid foundation, rather than reacting only to short-term currency movements.

The ringgit’s performance also comes at a time when Malaysia is trying to attract more high-quality investments that can generate long-term economic value. These include projects in artificial intelligence, cloud computing, data centres, semiconductors, renewable energy, advanced manufacturing and digital services.

For policymakers, the ringgit’s relative strength offers a positive signal that Malaysia remains attractive to investors despite global uncertainty. A more stable currency can support investor confidence, reduce pressure on import costs and help businesses plan more effectively.

For businesses and consumers, however, currency movements still carry mixed effects. A stronger ringgit can help reduce the cost of imported goods, raw materials and overseas payments, but it may also affect export competitiveness if the currency strengthens too quickly against trading partners’ currencies.

Amir Hamzah’s remarks suggest that Malaysia’s currency outlook remains closely tied to the country’s ability to sustain investment inflows, protect economic fundamentals and attract capital into high-growth sectors.

While external risks may continue to create short-term market movements, Malaysia’s strong investment pipeline, expanding digital economy and resilient domestic investor base are expected to remain key factors supporting the ringgit going forward.