Trading USD/MYR

Although the USD/MYR is not traded in significant volumes, the nature of the pair does provide exciting investing opportunities. The US Dollar is considered the global reserve currency and coupled with the Malaysian Ringgit, creates an exotic forex pair with interesting market dynamics. This article will discuss the history of the USD/MYR FX pair, price influences, exchange rate historical data, investing outlook, live price charts, and more.

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Breaking Down ‘USD/MYR’

The US Dollar (USD) is the currency of the United States of America. Its stability is impacted by the policies of the US Federal Reserve (Fed). Today, the USD is considered the global reserve currency, settling the majority of international transactions. Many countries choose to peg their currencies to the Dollar.

The Malaysian Ringgit (MYR) is the authorised currency of Malaysia, licensed by the Central Bank of Malaysia (Bank Negara Malaysia, BNM).

The exchange rate is the buy or sell price of the USD into MYR, for example, 1 USD to 2 MYR (1.2) means to buy 1 US Dollar, you will pay 2 Malaysian Ringgit.

History Of The USD

The US Dollar was officially adopted as the United States currency in 1785. The exchange rate was set against the value of gold until 1973. As gold stocks started to deplete due to banks using Dollar to gold conversions, the value of the currency fell. This signalled the end of the US peg for many countries at that time. After the US Dollar’s value was detached from gold, the Federal Reserve was appointed to maintain the value of the currency and the exchange rate, doing so with a low stable rate of inflation.

US Economy

The United States is the world’s largest economy, accounting for over 20% of global output. The country is the single largest importer and exporter of goods and services. US monetary policy plays a major role in financial conditions across the world due to the USD being the most widely used currency. As a result, developments can impact its strength against other currencies, such as the Ringgit. With this in mind, USD/MYR traders should keep an eye on GDP data, employment and interest rates, along with US political announcements, which can all trigger shifts in the forex markets.

History Of The MYR

The Malaysian Dollar substituted the British Borneo Dollar and the Malaya in 1967. It was called the Malaysian Ringgit in 1975 and is the country’s official currency. With that said, it is still sometimes known as the Malaysian Dollar.

After the Asian financial crisis in the 1990s, the public Bank of Malaysia chose to peg the MYR to the USD at a conversion rate of 3.8 to 1 until 2005. The MYR is now free-floating but offshore trading is limited.

Malaysian Economy

After the Asian financial crisis, the country has been on an upward course, averaging growth of around 5.4% since 2010. The country has diversified its economy from reliance on agriculture to one that supports manufacturing. Accounting for close to 20% of the nation’s exports are electronic integrated circuits and microassemblies. And while income equality is still prevalent in Malaysia, the country is making progress.

Investors should keep a close eye on economic reports, especially manufacturing data on the production of electricals, plus petroleum and palm oil, for an indication as to where the price of the MYR is heading.

Value Of The MYR

The value of the MYR is prone to changes in global emerging markets and the political stability in Malaysia. Other factors include:

  • Interest rates – News shows the Bank of Negara Malaysia is set to hold interest rates at a record-low 1.75%
  • Economy growth – The country has experienced many years of growth, with GDP forecasts expecting the MYR to remain above 5%
  • Commodities – The country is an exporter of gas and oil and MYR has a positive correlation with commodities
  • Inflation – The Central Bank of Malaysia stabilises rates aiming to keep this low. In 2019 Malaysia’s inflation rate was 0.66%, a decline from the previous year

USD/MYR forex trading

Value Of The USD

Factors influencing the value of the US Dollar include:

  • Dow Jones stock market – Positive correlation between the index and the USD value since the 1990s
  • US Treasury – Responsible for budget decisions. Any announcements or statements can impact the value of the USD
  • Reserve status – The USD is used by nations across the globe to purchase commodities creating an artificial demand
  • Monetary policy – As the USD is a fiat currency and not backed by a commodity, the creation of money can depreciate the value, therefore impacting the USD/MYR exchange rate

USD investing

Managing Price Movements

Supply and demand for currencies, such as the USD/MYR, can be heavily influenced by monetary policies set by respective central banks, plus other factors such as market sentiment or inflation. Other aspects include GDP growth rates, interest rates, inflation, and employment rates. Brokers and financial data sources integrate USD/MYR real-time spot rates, daily forex live charts, and the latest news bulletins to help you understand these.

Traders can also use technical analysis for USD to MYR forecast support, this includes extensive price history charts, such as 5, 10, 20, or 30 years data views. It is also good to utilise price trend statistics before trading the forex pair. Reference signals and indicator rates for entry and exit points of a trade can be leveraged, with candlestick charts commonly used for this.

Pros Of Trading USD/MYR

What makes the currencies a trading interest in today’s financial markets?

  • Prevalence – The USD is the most traded currency in the world and the world’s leading reserve currency
  • Plenty of financial information available – Including USD to MYR exchange rate history by date, predictions, and live currency converters
  • Volatility – The value of the Malaysian Ringgit is prone to influences in emerging global markets and political responses in Malaysia
  • Commodities correlation – USD/MYR forecasts in 2021, for example, suggested a positive economic outlook for Malaysia, thanks to strong crude oil and energy prices

Risks Of Trading USD/MYR

There are a few points to consider before investing in the USD versus MYR pair:

  • Volume – As an exotic pair, the USD v MYR sees the lowest trading volumes compared to major currencies today and less liquidity could mean reduced profit potential
  • Leverage – The pair’s volatility can increase profits using leverage, however it can also create significant losses. Implementing risk management forecasting tools when reviewing USD to MYR conversions and trading views for  yesterday, last week, this week and next week can help
  • Trading – MYR is a somewhat restricted currency, funds cannot be transferred out of Malaysia, though online forex trading is allowed

US Dollar Index

The US Dollar Index (USDX) is a measure of the value of the USD in relation to other key foreign currencies including the Euro. The index fluctuates in response to macroeconomic factors impacting the supply and demand of the Dollar and price movements of the other foreign currencies.

The outlook of the USDX can help paint a picture of the relative strength of the USD which can in turn inform investment decisions when trading pairs related to the Dollar, such as the USD/MYR.

USD/MYR & Exotic Pairs

Exotic pairs are those that include one major currency, and one currency from an emerging or developing market, such as the USD/MYR. They make up a much smaller share of the total forex market. Major currencies such as the USD are associated with stable economies. Exotic currencies such as the MYR can be heavily influenced by political and economic instability. Exotic currencies are usually traded at low volumes and can be very volatile. The lack of liquidity can often lead to wider spreads offered by brokers.

Final Word On Trading USD/MYR

There are many opportunities to start trading the USD/MYR forex pair. There are ample financial data resources available such as USD vs MYR exchange rate charts and forecasts. XE, TradingView or X-rates are good options for currency value data and graphs. Understanding the influences on the individual economies and finding a forex broker that provides USD/MYR trading tools such as real-time live streaming rates and historical data is key.

But while the exotic pair does offer profit potential, we think it’s best suited to experienced investors. Beginners may want to start off trading the EUR/USD which is easier to track and find data on.


How much is 1 USD to MYR?

The exchange rate value of 1 USD into MYR is constantly moving. Use live charts for the latest buying and selling rates, daily forecasts, or trading history to understand previous price trends.

Which statutory body regulates the Malaysian Ringgit for USD to MYR investing?

The Central Bank of Malaysia (Bank Negara Malaysia) is the country’s financial regulator. Commercial banks of Malaysia include Public Bank Berhad, CIMB, and Maybank.

What is the USD versus MYR in the currency pair?

The exchange rate is the price of the USD per MYR. You can use a selling rate of 1.2 Dollar to MYR to help you understand this concept. The bid-ask is 1 USD to 2 MYR so to buy 1 US Dollar you will pay 2 Malaysian Ringgit.

What is a USD/MYR basis swap?

A USD/MYR basis swap is an agreement between 2 parties exchanging interest payments based on two floating rates, subject to swap points.

What is USD/MYR forward rates?

Forex forward rates are forex exchange rates ‘locked in’ for the buy or sell of pairs such as USD to MYR at a later date. For example, investing now for six months ahead at the current forward rate.