Trading AUD/MYR

The AUD/MYR currency pair is a popular forex asset. The Australian Dollar represents one of the world’s largest economies and is the fifth most traded currency. The Malaysian Ringgit is one of the strongest currencies on the Asian continent and is susceptible to changes in emerging markets and political sentiment.

This guide will break down the history of the AUD/MYR. We also explain how to trade the pair, looking at factors that influence the AUD vs. MYR exchange rate and principles for successful forex trading. In addition, we list the top brokers for trading AUD/MYR in 2022.

AUD/MYR Trading Brokers

  1. Take positions on major, minor and exotic currency pairs with competitive trading conditions.

    OANDA Corporation is regulated by the CFTC/NFA. OANDA is a member Firm of the NFA (Member ID: 0325821). CFDs are not available to residents in the United States.

    GBPUSD Spread
    3.4
    EURUSD Spread
    1.6
    EURGBP Spread
    1.7
    Total Assets
    70
    Leverage
    1:30 EU, 1:200 Global
    Platforms
    MT4
  2. Forex.com are a leading FX broker. Offering a large range of currency pairs and some of the tightest spreads in the industry.

    GBPUSD Spread
    1.0 Var
    EURUSD Spread
    0.8 Var
    EURGBP Spread
    0.8 Var
    Total Assets
    80+
    Leverage
    1:200
    Platforms
    MT4
  3. Trade currencies, including pairs with the USD

    GBPUSD Spread
    1.6 pips
    EURUSD Spread
    1.3 pips
    EURGBP Spread
    1.6 pips
    Total Assets
    50+
    Leverage
    -
    Platforms
    Own
  4. Speculate on the price movement of 11 currency pairs with binary options contracts.

    GBPUSD Spread
    0.25 pips Var
    EURUSD Spread
    0.25 pips Var
    EURGBP Spread
    0.25 pips Var
    Total Assets
    11
    Leverage
    -
    Platforms
    Own
  5. Trade a range of major, minor and exotic currencies

    Forex trading involves risk. Losses can exceed deposits

    GBPUSD Spread
    from 0.589 pips
    EURUSD Spread
    from 0.165 pips
    EURGBP Spread
    from 0.540 pips
    Total Assets
    90+
    Leverage
    1:30
    Platforms
    MT4
  6. eToro offers a selection of major, minor and exotic currency pairs. Clients can speculate on FX from the eToro trading app.

    79% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

    GBPUSD Spread
    2 pips
    EURUSD Spread
    1.5 pips
    EURGBP Spread
    1.5 pips
    Total Assets
    49
    Leverage
    None
    Platforms
    Own
  7. Use digital options to take straightforward buy and sell positions on a range of currencies.

    GBPUSD Spread
    N/A
    EURUSD Spread
    N/A
    EURGBP Spread
    N/A
    Total Assets
    20+
    Leverage
    -
    Platforms
    Own
  8. Trade on dozens of currency pairs with tight spreads

    GBPUSD Spread
    0.7
    EURUSD Spread
    From 0.0
    EURGBP Spread
    0.5
    Total Assets
    70+
    Leverage
    1:30 EU, 1:500 Global
    Platforms
    MT4, MT5
  9. Take positions on a long list of forex pairs with tight spreads and low commissions.

    GBPUSD Spread
    From 0.6
    EURUSD Spread
    From 0.6
    EURGBP Spread
    From 0.6
    Total Assets
    53
    Leverage
    1:1000
    Platforms
    MT4, MT5
  10. IB Boast a huge market share of global trading. With a minimum deposit of $10,000 however, they remain an option for larger traders only.

    GBPUSD Spread
    Commission (.20 pts x trade value)
    EURUSD Spread
    Commission (.20 pts x trade value)
    EURGBP Spread
    Commission (.20 pts x trade value)
    Total Assets
    70+
    Leverage
    1:50
    Platforms
    AlgoTrader, OmniTrader
  11. Go long or short on a range of major and minor currency pairs with tight spreads.

    GBPUSD Spread
    Av. Floating 0.6
    EURUSD Spread
    Av. Floating 0.2
    EURGBP Spread
    Av. Floating 0.5
    Total Assets
    1000+
    Leverage
    1:1000
    Platforms
    MT4, MT5
  12. Trade 75+ major and minor currency pairs with floating spreads.

    GBPUSD Spread
    Variable
    EURUSD Spread
    Variable
    EURGBP Spread
    Variable
    Total Assets
    75+
    Leverage
    -
    Platforms
    Own
  13. Webull offers FX trading with tight floating spreads

    GBPUSD Spread
    Variable
    EURUSD Spread
    Variable
    EURGBP Spread
    Variable
    Total Assets
    17
    Leverage
    -
    Platforms
    Own

AUD/MYR Explained

Firstly, what does the AUD/MYR mean? It is simply the quote for the Australian Dollar vs. Malaysian Ringgit exchange rate. The Australian Dollar is the base currency while the Malaysian Ringgit is the counter currency.

Note, the Ringgit is often unofficially referred to as the Malaysian Dollar.

Live Chart

Why Trade AUD/MYR?

With so many daily forex options, why should you focus your attention on the AUD/MYR?

  • Recovery – The Ringgit has recently weakened, particularly against the AUD. This is due in part to Australian policies and a weakening of the yuan. Interestingly though, Malaysian economists expect the currency to recover in the third quarter of 2022.
  • Volatility – The value of the Ringgit is susceptible to changes in global emerging markets and political sentiment in Malaysia. The AUD is also uncommonly counter-cyclical and volatile. As a result, there is plenty of pip movement and opportunities to profit from steep price fluctuations.
  • Related to commodity prices – Both AUD and MYR are driven, in part, by the price of commodities. Malaysia is an exporter of oil and natural gas, so the Ringgit has some correlation to commodity prices. The strength of the AUD is also closely tied to its exposure to Asia and the commodity cycle. AUD is a popular alternative for traders looking to go long on commodity exposure and/or Asian demand.
  • Availability of resources – Economic data that you can use to help with an AUD v MYR 30 days forecast, for example, can easily be found online, for free. Australia’s Bureau of Agricultural and Resource Economics and Sciences (ABARES) produces regular reports on crop planting, weather, harvests, mine output, and money in metal prices, all of which can affect the AUD exchange rate. Technical analysis today is also easier than ever before. This is because you can analyze graphs and candlestick charts with customized indicators and sophisticated trading tools.

AUD To MYR History

The Ringgit has been Malaysia’s official currency since 1975. Originally, MYR was pegged to the USD, but over time the peg was removed. It was then reinstated in 1997 when Asia suffered a financial crisis. Because of the surge in capital outflows during the crisis, trading Ringgit outside of Malaysia was banned. Today, that peg to the US Dollar has once again been removed, and the Ringgit now floats against many large world currencies on the forex market.

The Malaysian central public bank, the Bank Negara Malaysia (BNM), usually has a policy of keeping the MYR exchange rate down instead of supporting it. However, the MYR has lost strength in recent years because of Covid-19 and political uncertainty. Interest rates had a projected hike of up to 3.2% in 2022.

MYR accounts for about 0.1% of daily turnover in the forex market and ranks 34th in trading activity among the world’s currencies.

The Malaysian Ringgit is made up of 100 sen and is issued in denominations of 1, 5, 10, 20, 50, and 100. The 500 and 1,000 denominations are not usable, even though some are still in circulation.

Note, the AUD/MYR reached an all-time high of 3.44 in July 2017; and an all-time low of 2.15 in October 2008.

The Malaysian Economy

Malaysia has been able to reduce extreme poverty and increase prosperity for its citizens. Its goal is to become a high-income and developed nation while making sure that everyone can live well.

The currency plays a key role in its development and understanding the drivers will help you make informed decisions when investing in the AUD/MYR.

  • Malaysia exports large amounts of palm oil products, exporting the second greatest volume after Indonesia.
  • The country previously relied on the production of agricultural export commodities and minerals, but now it relies on manufacturing and services.
  • The Malaysian economy is now the fourth biggest in Southeast Asia after Indonesia, Thailand, and Vietnam. It is the world’s 37th largest economy.
  • Economic downturns in the last few years have severely damaged the country’s investments. The country is emerging from a ‘double-dip’ recession caused by Covid-19.
  • The economy of Malaysia is one of the globe’s most competitive and is very diverse and robust thanks to the export value of its high-tech products, which stands at over $90 billion.
  • Malaysia has many natural resources, especially in the minerals, forestry, and agricultural sectors. Its most valuable exported resource is petroleum, with tobacco, pineapples, pepper, cocoa, timber, and rubber being vital to the economy’s health.

Trading the AUDMYR currency pair

The Australian Economy

It is also important to understand the make-up of the Australian economy to implement an effective strategy when trading the AUD/MYR.

  • In terms of GDP (measured in U.S. dollars), Australia is the 13th-largest economy.
  • Farming is also a critical component, as over 2% of the GDP is tied to agriculture (and related sectors), with a large percentage of the output going outside the country.
  • Among developed countries, Australia stands out for its heavy reliance on commodities. Mining (including energy) represents 11.5% of the country’s GDP, with a heavy emphasis on nickel.
  • AUD is popular among forex traders for its 3 G’s – geology, geography, and government policy. Geology has provided the country with a wealth of natural resources in high demand, including oil, gold, agricultural products, diamonds, iron ore, uranium, nickel, and coal.
  • Due to its geography, Australia is positioned as an ideal trading partner for many fast-growing Asian regions that have a high level of demand. The country also has a stable government and economy, a lack of intervention in the currency markets, and a Western approach to business.

AUD MYR forex conversion

Factors Driving MYR Value

Several key factors impact the MYR exchange rate:

  • The cost of borrowing – Bank lending in Malaysia reached a record low of 3.40% in 2021. It had since slightly increased to 3.478% by March 2022.
  • The flow of capital into and out of the country – In the long-term, Malaysia’s capital flows are projected to trend around 7800.00 Million MYR in 2023.
  • The flow of exports and imports into and out of the country – Malaysia has a diversified export base, which includes natural gas, electrical appliances, electronic components, and palm oil.
  • The merchandise trade balance – Malaysia’s trade balance by April 2022 was 23.5 billion MYR, a 20.4 billion MYR increase from the same month a year ago. This is 0.8 billion MYR above predictions.
  • The long-term and short-term interest rate differential – Interest rates in Malaysia have been held at a record low of 1.75%. However, recent geopolitical events have pushed the projection to 2.2% and 3.2% in 2022.
  • The rate of inflation set by the Bank Negara Malaysia – Bank Negara Malaysia (BNM) is responsible for managing monetary policy in Malaysia. The central bank leverages this policy on the MYR bank rate in an attempt to ensure financial and monetary stability. One key facet of sustainable growth is price stability, and in this spirit, the financial institution strides to keep inflation balanced. The monetary policy also aims to keep exchange rates stable, for example, in the AUD/MYR.
  • The relative growth of the economy – In Q1 of 2022, Malaysia’s economy grew by 5% year on year, which was faster than the 3.6% growth in Q4 of 2021 and higher than the market expected, which was a 4% growth rate. This was helped by rising domestic demand as economic activity continued to normalize after Covid-19 restrictions were lifted. The Central Bank set GDP forecasts at between 5.3% and 6.3% for the remainder of 2022.

Factors Driving AUD Value

Several key drivers affect the AUD exchange rate:

  • The strength of the Aussie dollar – Value is closely tied to its exposure to Asia and the commodity cycle.
  • Major economic data – The release of GDP, retail sales, industrial production, inflation, and trade balances, can affect AUD.
  • Australia produces relatively little in the way of manufacturing exports – Most of the country’s exports also go to the growing economies of Asia.
  • Key information – Employment, interest rates (including scheduled meetings of the central bank), and the daily news flow – natural disasters, elections, and new government policies can all have significant impacts on the AUD/MYR exchange rate.
  • Australia’s economy is driven by commodities – Both metals and grains, and reports on crop planting, weather, harvests, mine output, and metal prices can all move AUD. Australia’s Bureau of Agricultural and Resource Economics and Sciences (ABARES) produces regular reports on each.
  • Higher commodity prices – These create recessionary (or at least inflationary) pressures in most developed economies. This can lead traders to have concerns for the health and growth of economies in Europe, North America, and Japan, which can make the Australian economy look favorable. That positions the Australian dollar as a popular alternative for traders looking to go long on commodity exposure and/or Asian resource demand while going short on countries likely to suffer due to higher input costs.

Tips For Trading AUD/MYR

Whether you are trading AUD to MYR or another currency pair, you will want to develop a good strategy to incorporate into your investing plan. This will significantly increase your chances of success when trading forex.

Several popular strategies used to trade forex could be suitable for you, depending on your experience level and personality.

The popular principles listed below are common trading tactics to help you become a successful forex investor:

  1. Keep up to date with news – Day traders, in particular, need to keep up with the latest news and events that could affect a currency’s exchange rate, for example, interest rate announcements from central banks. Events from yesterday can significantly impact AUD/MYR exchange rate forecasts and market outlook.
  2. Set aside funds – Assess how much capital you’re willing to risk on each trade and set your risk accordingly. See our guide to risk management for more tips.
  3. Set aside time for the markets – Online trading takes time. It requires a trader to track the FX markets and spot opportunities, which can arise at any time during trading hours. Studying average historical 10-year charts, for example, can also be a great way to learn more about the AUD/MYR pair.
  4. Start small – Whether you’re a beginner or experienced but investing in a new currency pair like the AUD/MYR, start small to test out a strategy. Check the current buying and selling rates before you take a position and use leverage calculators offered by many top forex brokers.
  5. Cut losses with limit orders – Use stop losses to help manage your AUD/MYR trades. If the currency dips below a certain price, it will automatically close the trade, meaning you won’t lose more than a fixed amount.
  6. Stay calm – There are times when the forex market tests nerves. As a day trader, in particular, it is important to stay calm. Decisions should be made using logic and not emotion.
  7. Stick to your plan – Developing a strategy in advance is important to becoming a successful day trader. Don’t let your emotions get the best of you and abandon your strategy.

Final Word On Trading AUD/MYR

The AUD/MYR forex pair offers good opportunities for traders looking to speculate on emerging markets. While not traded in the significant volumes seen with major FX pairs, there is plenty of room to implement effective strategies.

Before you start trading AUD/MYR, make sure you understand what influences the exchange rate and strength of each economy. You will also need a top forex broker that offers excellent tools, such as live exchange rate charts, historical data, and real-time quotes to enable you to make predictions about future prices. Oanda is one popular forex platform.

FAQ

Why Has The MYR Weakened Against The AUD In Recent Years?

The Malaysian Ringgit weakened due to Covid-19, political instability, and the impact of inflation on consumers. Lower yuan rates are also a contributing factor. However, Malaysian economists predict an economic recovery. 

Is MYR Getting Stronger Against The AUD?

The MYR is forecast to continue strengthening on the back of a recovering economy, helped by stronger energy prices and higher production rates. 

Is MYR/AUD A Restricted Currency?

The MYR is often considered to be a restricted currency. Fund transfers in this currency are typically not allowed outside Malaysia, though online trading is still possible.

Why Is The AUD So Strong Against The MYR?

Several forces are driving the AUD. First and foremost, mining and export industries are on the rise, particularly with China wanting to resume normal pre-Covid-19 operations. Secondly, Australia had a record low unemployment rate of 3.9% in April 2022. 

Is The AUD Likely To Rise Against The MYR?

AUD is expected to rise in the next five years. By 2027, the AUD/MRY pair is predicted by some market commentators to go from the current 3.11 to 3.56, an increase of more than 14%.