Why Malaysians Are Buying Foreign Currency During A Strong Ringgit

Should you convert foreign currency now or wait? This question has been surfacing more often as the ringgit firms up. Instead of worrying about how far it might fall, more Malaysians are considering whether this is a moment to act. Trust me when I say that this shift is not only reflected in the news but also every time I meet a friend at a cafe and even in online discussions. I have come across multiple Reddit threads debating whether the stronger ringgit actually makes travel, cross-border spending and overseas payments more worthwhile.

Foreign currency buying has begun to feel less like a niche habit and more like a practical decision. For some, it is about upcoming holidays, overseas tuition fees or subscriptions priced in stronger currencies. For others, there is a lingering thought that converting now might offer a small advantage later, a way to make a stronger ringgit work a little harder. 

Recent reports show the ringgit trading at its strongest levels since mid-2021, hovering around the low RM4.1 range against the US dollar and strengthening noticeably against regional currencies such as the Singapore dollar.

There is a significant difference between planning ahead for expenses you know are coming and treating foreign currency buying as a way to grow wealth. The first can reduce stress and protect against short-term swings. The second often looks smarter on paper than it feels in practice, once you factor in spreads, fees, timing risk and the simple reality that exchange rates can turn just as quickly as they improve.

When a strong ringgit makes people move fast

A strong ringgit changes how everyday purchases feel. Holidays look cheaper, overseas shopping carts feel less painful and big-ticket commitments like paying foreign university fees suddenly seem more manageable. 

Against the Singapore dollar, the ringgit has also firmed compared to its recent averages, making cross-border spending, short trips and subscriptions priced in SGD feel marginally more affordable than they did previously. In fact, the Malaysian ringgit recently hit a three-year high against the Singapore dollar, trading near S$1 ≈ RM3.17. At current levels, even modest movements in the ringgit can translate into noticeable differences for frequent spenders, especially for currencies used repeatedly rather than one-off trips.

Media coverage in late November 2025 described Malaysians exchanging currency ahead of upcoming trips and experiences, explicitly to “lock in” better rates. That behaviour is not irrational, it is a form of budgeting. If you already expect to spend in SGD, JPY, USD, THB or EUR within a near timeframe, converting some funds during a strong ringgit period can reduce your exposure to a sudden reversal.

On the macro side, Bank Negara Malaysia has also pointed to drivers behind the ringgit’s firmer performance, including domestic economic prospects and broader US dollar dynamics. In plain terms, people are reacting to a moment where the ringgit feels like it has momentum and that creates urgency. Nobody wants to be the person who waited and watched the rate “slip away”.

The hidden costs people forget

Here is the part many of us tend to overlook: the rate we see on a chart is not the rate we always get. Money changers and banks quote buy-sell spreads and that is effectively a cost. Add service fees, card foreign transaction charges and platform mark ups and the “cheap” conversion can become less impressive.

Then there is the risk of timing. If you convert because you think the ringgit will weaken later, you are making a forecast. Even professional currency strategists can be wrong and currency moves can be driven by surprises, policy signals and global risk sentiment. Bank Negara’s messaging consistently frames the ringgit as market-determined and encourages the public to focus on understanding how exchange rate movements work rather than anchoring on a single bilateral rate. 

So yes, foreign currency buying can be practical. But if the goal is profit, the bar is higher than most people realise. You must beat the spread, the fees and the opportunity cost of keeping money in ringgit based options.

Is it a “strategy” or just a spending decision?

A useful way to sanity check this trend is to ask one question: “What is this money for?” If it is for travel, overseas medical expenses, subscriptions priced in foreign currency or a child’s foreign education cost, converting is more like pre-paying a known bill. In that case, a strong ringgit is simply a favourable window to reduce uncertainty. You are not trying to be clever, you are trying to be prepared.

If you are converting with no specific spend planned, hoping to convert back later for a gain, that is closer to speculation. And speculation in currencies is not automatically wrong, but it should be treated with the same seriousness as any high risk move. Your downside can show up as a weaker conversion rate when you need the money back in MYR or as a missed chance to grow wealth through instruments designed for long term returns.

It is also important to note the fraud angle. Whenever “forex” becomes a dinner table topic, scams tend to ride the wave. Bank Negara Malaysia has explicitly cautioned the public against illegal foreign currency trading schemes and training programmes that are promoted as investments. If someone is selling guaranteed monthly returns tied to currency movements, treat it as a red flag, not a shortcut.

Comparing foreign currency buying to other ways of growing wealth

If your goal is genuinely to grow wealth, consider how foreign currency buying stacks up against alternatives.

The key difference is that long term investing is designed to reward time, while currency moves can be noisy and mean reverting. A strong ringgit can be a great moment to diversify internationally, but doing that through a well structured investment plan is not the same thing as stocking up on notes at a counter.

A practical way to approach the frenzy

If you are tempted to join the rush, try this simple framework:

• Convert only what you reasonably expect to spend in the next 3 to 12 months.
• If you already have concrete plans such as an upcoming holiday, overseas education expenses or regular foreign currency commitments, go for it.
• Split conversions into a few smaller rounds instead of one big bet, so you do not rely on perfect timing.
• Keep records of your all in rate, including spreads and fees, so you are not fooled by headline numbers.
• If your goal is wealth, treat currency conversion as a supporting move, not the core plan.
• Stay alert to “forex investment” pitches and check Bank Negara’s alert resources before engaging with any entity you do not recognise. 

In other words, let a stronger ringgit improve your real life costs, not hijack your financial judgement. Foreign currency buying is most sensible when it is tied to a real need, not a hope.