Ringgit Owes Its Surge to Forces Well Beyond Dollar’s Weakness

The Malaysian ringgit’s relentless rally is being driven by a range of structural factors beyond the dollar’s broad weakness, suggesting its gains will likely be sustained.

Only about a quarter of the ringgit’s 12% surge over the past year — the biggest in Asia — is attributable to macro catalysts such as global risk sentiment and moves in the greenback, according to a Bloomberg analysis. Strengthening economic fundamentals — such as rising investment flows and growth that’s exceeded expectations — are proving to be more durable tailwinds for the currency, which has climbed to its strongest level since 2018.