Malaysian ringgit

Malaysian ringgit
Ringgit Malaysia (Malay) ريڠڬيت مليسيا (Malay)
50 ringgit
ISO 4217 code	MYR
Central bank	Bank Negara Malaysia
Website	www.bnm.gov.my
User(s)	Malaysia
Inflation	-2.4%
Source	Department of Statistics, Malaysia, Aug 2009
Subunit
1/100	sen
Symbol	RM
Coins	5, 10, 20, 50 sen
Banknotes	RM1, RM5, RM10, RM50, RM100
Mint	Royal Mint of Malaysia
Website	royalmintmalaysia.com or www.royalmint.com.my

The Malaysian ringgit (plural: ringgit; currency code MYR; formerly the Malaysian dollar) is the currency of Malaysia. It is divided into 100 sen (cents). The ringgit is issued by the Bank Negara Malaysia.

Etymology

The word ringgit means "jagged" in Malay and was originally used to refer to the serrated edges of silver Spanish dollars which circulated widely in the area during the 16th and 17th century Portuguese colonial era. The Singapore dollar and the Brunei dollar are also called ringgit in Malay (although currencies such as the U.S. and Australian dollars are dolar), hence its official abbreviation RM for Ringgit Malaysia.

The Malay names ringgit and sen were officially adopted as the sole official names in August 1975. Previously they had been known officially as dollars and cents in English and ringgit and sen in Malay, and in some parts of the country this usage continues. For example, in Malaysia one ringgit is "one dollar" in English and "tsit⁸-kho·¹-gin⁵" (蜀箍銀) in Hokkien. In the northern states of Peninsular Malaysia, denominations of 10 sen are called kupang in Malay ("poat⁸" in Hokkien), e.g. 50 sen is 5 kupang.

History

On June 12, 1967, the Malaysian dollar, issued by the new central bank, Bank Negara Malaysia, replaced the Malaya and British Borneo dollar at par. The new currency retained all denominations of its predecessor except the $10,000 denomination, and also brought over the colour schemes of the old dollar. Over the course of the following decades, minor changes were made on the notes and coins issued, from the introduction of the M$1 coin in 1967, to the demonetisation of M$500 and M$1000 notes during the 1990s.

The use of the dollar sign "$" (or "M$") was not replaced by "RM" (Ringgit Malaysia) until the 1990s, though internationally "MYR" (MY being the country code for Malaysia) is more widely used.

As the Malaysian dollar replaced the Malaya and British Borneo dollar at par, the new dollar was originally valued at 8.57 dollars per 1 British pound sterling. In November 1967, five months of the introduction of the dollar, the pound was devalued by 14.3%. The new currency was not affected but earlier notes of the Malaya and British Borneo dollar were still pegged to pound at 8.57 dollars per 1 pound and, consequently, these notes were reduced in value to 85 cents per dollar.

Despite the emergence of new currencies in Malaysia, Singapore and Brunei, the Interchangeability Agreement which the three countries continued to adhere to as they were originally parts of a currency union meant the Malaysian dollar was also exchangeable at par with the Singapore dollar and Brunei dollar until May 8, 1973, when the Malaysian government pulled out of the agreement. The Monetary Authority of Singapore and the Brunei Currency and Monetary Board still maintain the interchangeability of their two currencies, as of 2009.

Between 1995 and 1997, the ringgit was trading as a free float currency at around 2.50 to the U.S. dollar, before dipping to under 3.80 to the dollar by the end of 1997, following the year's East Asian financial crisis. For the first half of 1998, the currency fluctuated between 3.80 and 4.40 to the dollar, before Bank Negara Malaysia pegged the ringgit to the US dollar in September 1998, maintaining its 3.80 to the dollar value for almost seven years, while remaining floated against other currencies.

The ringgit lost 50% of its value against the US dollar between 1997 and 1998, and suffered general depreciation against other currencies between December 2001 and January 2005. As of September 4, 2008, the ringgit has yet to regain its value circa 2001 against the Singapore dollar (SGD) (2.07 to 2.40 to the MYR),) the Euro (EUR) (3.40 to 4.97 to the MYR), the Australian dollar (AUD) (1.98 to 2.80 to the MYR), and the British pound (GBP) (5.42 to 6.10 to the MYR).

Single currency units in ringgit, averaged over the year.

	1995	2000	2001	2002	2003	2004	2005	2006	2007	2008	2009	2010 (as of 3 Oct)
United States dollar	2.5415	3.8000	3.8000	3.8000	3.8000	3.8000	3.7872	3.6669	3.4356	3.3308	3.5245	3.0854
Euro	3.2499	3.5089	3.4025	3.5925	4.2999	4.7267	4.7144	4.6028	4.707	4.8851	4.9040	4.0107
British pound	3.9458	5.7602	5.4802	5.7096	6.2116	6.9511	6.8928	6.7531	6.8748	6.3619	5.5081	4.8878
Singapore dollar	1.7950	2.2034	2.1208	2.1226	2.1807	2.2488	2.2762	2.3082	2.2807	2.3542	2.4237	2.3125
Australian dollar	1.8877	2.20995	1.9647	2.0661	2.4786	2.7997	2.8874	2.7622	2.8796	2.8239	2.7823	2.8129
Japanese yen	0.024593	0.035257	0.031291	0.030395	0.032832	0.035154	0.034377	0.031517	0.029194	0.032351	0.037690	0.036520
Chinese yuan	0.3046	0.4590	0.4591	0.4589	0.4589	0.4591	0.4622	0.4599	0.4519	0.4798	0.5159	0.4601
Source: x-rates.com

On July 21, 2005, Bank Negara announced the end of the peg to the US dollar immediately after China's announcement of the end of the renminbi peg to the U.S. dollar. According to Bank Negara, Malaysia allows the ringgit to operate in a managed float against several major currencies. This has resulted in the value of the ringgit rising closer to its perceived market value, although Bank Negara has intervened in financial markets to maintain stability in the trading level of the ringgit.

Following the end of the currency peg, the ringgit appreciated to as low as 3.16 to the U.S. dollar in April 2008. The ringgit had also enjoyed a period of appreciation against the Hong Kong dollar (HKD) (from 0.49 to 0.44 to the MYR) and the renminbi (CNY) (0.46 to 0.45 to the MYR) as recently as May 2008.

Fiscal mismanagement by the ruling federal government, political uncertainty following the country's 2008 general election and the 2008 Permatang Pauh by-election, falling oil prices, and the lack of intention by Bank Negara to increase already low interest rates (which remained at 3.5% since April 2006) led to a slight fall of the ringgit's value against the US dollar between May and July of 2008, followed by a sharper drop between August and September of the same year. As a result, the US dollar appreciated significantly to close at 3.43 to the MYR as of September 4, 2008, while other major currencies, including the renminbi and Hong Kong dollar, follow suit. The drop brings the ringgit to its weakest since September 24, 2007, and ranks it as the second worst performing Southeast Asian currency between June 2008 and September 2008.

Current MYR exchange rates
From Google Finance:	AUD CAD CHF EUR GBP HKD JPY USD SGD CNY
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From XE.com:	AUD CAD CHF EUR GBP HKD JPY USD SGD CNY
From OANDA.com:	AUD CAD CHF EUR GBP HKD JPY USD SGD CNY
From fxtop.com:	AUD CAD CHF EUR GBP HKD JPY USD SGD CNY

Coinage

First series (1967)

The first series of sen coins were introduced in 1967 in denominations of 1 sen, 5 sen, 10 sen, 20 sen, 50 sen, followed by the introduction of the 1 ringgit coin (which continued to use the $ symbol and is the largest coin in the series) in 1971. While varied by diameters, virtually all the coins were minted in near-consistent obverse and reverse designs, the latter depicting the then recently completed Malaysian Houses of Parliament and the federal star and crescent moon derived from the canton of the Malaysian flag. All coins were minted from cupronickel, the only exception being the 1 sen coin, which was first composed from bronze between 1967 to 1972, followed by steel clad with copper from 1973 onwards. The 50 sen coin is the only coin in the series to undergo a redesign—a minor modification on its edge in 1971 to include " Bank Negara Malaysia" letterings.

Minting of the first sen series was halted in 1989 when the second series was introduced in circulation. The coins, however, remain in legal tender as of 2010, but have steadily declined in numbers since the 1990s and are now scarcely in circulation. The $1 coin has not been in common circulation since the introduction of the second series $1 coins in 1989.

First series
Image		Value	Technical parameters		Description			Date of
Obverse	Reverse		Diameter	Composition	Edge	Obverse	Reverse	first minting	issue
		1 sen	18 mm	Bronze	Plain	State title, value, year of minting	Parliament House and a 13-pointed star and crescent moon	1967	12 June 1967
		1 sen		Copper clad steel				1973	?
		5 sen	16 mm	Cupronickel	Reeded	State title, value, year of minting	Parliament House and a 13-pointed star and crescent moon	1967	12 June 1967
		10 sen	19 mm
		20 sen	23 mm
		50 sen	28 mm
		50 sen			Lettered " BANK NEGARA MALAYSIA"			1971	?
		$1	33 mm		Lettered " BANK NEGARA MALAYSIA"		Parliament House and a 14-pointed star and crescent moon. The crescent and stars are depicted in thinner forms; the crescent itself is significantly larger and situated in the same position as the Parliament House.	1971	1 May 1971

Second series (1989)

The second series of sen coins entered circulation in late-1989, sporting completely redesigned observes and reverses, but predominantly retaining the design of edges, diameters and composition of the previous series' coins as of 1989—the 1 ringgit coin an exception. Changes include the inclusion of a Hibiscus rosa-sinensis (Malay: Bunga Raya), the national flower of Malaysia, on the upper half of the observe, and the depiction of items of Malay culture on the reverse.

The 1 ringgit coin is the only coin to have received a total revision. In addition to changes on its observe and reverse, the size of the coin was also reduced from a diameter of 33 mm to 24 mm, and was minted from an alloy of copper, zinc and tin, as opposed to the first series' cupronickel. The $ symbol was brought over to the new coin, but was dropped in favour of "RINGGIT" for coins minted from 1993 onwards. On December 7, 2005, the 1 ringgit coin was demonetised and withdrawn from circulation. This was partly due to problems with standardisation (two different versions of the second series coin were minted) and forgery.

As of April 1, 2008, a rounding mechanism of prices to the nearest 5 sen, applied to the total bill only, is in force, which was first announced in 2007 by Bank Negara Malaysia, in an attempt to render the 1 sen coin irrelevant. Individual items and services can still be priced in multiples of 1 sen with the final totaled rounded to the nearest 5 sen. For example, purchasing two items priced RM4.88 and RM3.14, totalling RM8.02, would then be rounded to RM8.00. If each item had been individually rounded (to RM4.90 and RM3.15 respectively) the incorrect total would have been RM8.05. In practice, individual items will probably remain priced at so-called " price points" (or psychological pricing and odd-number pricing) ending in 98 and 99 to maximize rounding gains for the vendor, especially in the case of single item purchases. Existing 1 sen coins in circulation remain legal tender for payments up to RM2.00.

Second series
Image		Value	Technical parameters		Description			Date of
Obverse	Reverse		Diameter	Composition	Edge	Obverse	Reverse	first minting	issue
		1 sen	18 mm	Bronze clad steel	Plain	Bank title, value, year of minting	Rebana ubi	1989	4 September 1989
		5 sen	16 mm	Cupronickel	Reeded	Bank title, value, year of minting	Gasing	1989	4 September 1989
		10 sen	19 mm				Congkak
		20 sen	23 mm				Sirih and kapur container
		50 sen	28 mm		Lettered " BANK NEGARA MALAYSIA"		Wau
		$1	24 mm	Copper-zinc-tin	Reeded	Bank title, "$1", year	Keris with a songket background	1989	4 September 1989
		$1				Bank title, "1 RINGGIT", year of minting		1993	?
For table standards, see the coin specification table.

Kijang Emas

Three denominations of gold bullion coins, the " Kijang Emas" (the kijang, a species of deer, being part of Bank Negara Malaysia's logo) are also issued, at the face value of RM 50, RM 100 and RM 200. It was launched on July 17, 2001 by Bank Negara Malaysia and was minted by the Royal Mint of Malaysia. The purchase and reselling price of Kijang Emas is determined by the prevailing international gold market price.