The ringgit rose 0.3% versus the greenback to 4.0955 on Friday, the highest since May 2021. With an over 9% gain against the dollar, it is Asia’s best-performing currency this year.

Fuelling the Malaysian currency’s popularity is an export-driven economy that has benefited from a rebound in global demand, helping third-quarter growth to beat expectations. Investor mood has also brightened following a thaw in US-China trade relations – Malaysia’s two largest export markets.

The optimism has prompted foreign investors to expand their exposure to Malaysian assets. Global funds poured US$1.5 billion into the country’s bonds in November, the largest inflows in six months.

The local central bank is expected to keep interest rates unchanged through 2026, according to a Bloomberg survey of economists, which will likely lend additional support for the currency.