RM versus other currencies. Still can travel?
I read an interesting view from a good friend, co-founder of Fave, Yeoh Chen Chow. Do google to know him better if you do not know him yet. Here’s one intro in firstclasse.com.my His views are always supported by facts and are always objective. He’s also extremely successful in the start-up world too which is a great example for all of us.
Just make your decisions based on what you believe yeah. The below are his exact views and his research on Ringgit versus many currencies for the past 12 months. Yes, he has consented to these being republished in kopiandproperty.com Right after his views, you can see I have also done the study for the same currencies but I stretch it to past 5 years. Happy knowing.
Within past 12 months, please note one major point yeah
Ringgit has appreciated versus Chinese Yuan and Indonesian Rupiah. Ringgit’s value is flat versus Yen, Taiwanese Dollar and Indian Rupee. Meanwhile, except for AUD and Canadian Dollar which RM has depreciated at 1.3% and 1.5% respectively, for all other countries listed below, Ringgit’s difference versus their currency is less than 1%.
Ringgit did drop and it’s against these currencies:
What about versus the ‘worst’ two currencies over 5 years?
We can see that Ringgit has depreciated 7.9% versus Euro and 9 percent versus Pound within past 12 months. If we are to look at the same two currencies over the past 5 years, it was Pound 1 to RM5.40 five years ago and it was Pound 1 to RM5.31 one year ago. Hope you understand the fluctuations yeah. Ringgit was as high as RM4.9654 to 1 Pound just in September 2022.
Versus the Euro 5 years ago, it was Euro 1 to RM4.74 five years ago and Euro 1 to RM4.68 one year ago. Fluctuations has happened and Ringgit appreciated to highest at RM4.4643 to 1 Euro in September 2022.
Not to tell you Ringgit’s performance is awesome yeah
Just wanted to tell you that Ringgit’s performance is fluctuating and one major reason is because US$ is seen as a world currency and thus if the interest rate difference is huge (where US is high and MY is low), then of course people would have a higher return if they were to keep their holding in US$ instead of RM. Briefly, if you can get a rate of close to 6% per annum (USA) versus just 3% per annum (Malaysia), which currency would you want to hold more and which currency you prefer to hold less?
As for the question of why not we just increase the interest rate, then better start thinking about the people whose loans will be affected due to an increasing rate yeah.
Happy understanding.
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