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Ringgit Strength Not Translating to Lower Prices

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  Published in Business and Finance on Monday, February 16th 2026 at 3:52 GMT by Lowyat.net
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Kuala Lumpur, Malaysia - February 16th, 2026 - The Malaysian Ministry of Finance (MoF) today addressed growing public concern regarding the lack of price reductions in imported goods, despite the significant strengthening of the Ringgit against the US dollar. While the currency has seen substantial appreciation - reaching RM4.06 to the dollar last week - consumers have yet to experience corresponding savings at the checkout.

The MoF released a statement acknowledging these concerns and outlining ongoing efforts to investigate the reasons behind the pricing anomaly. The Ministry confirmed it is working in close collaboration with key agencies including Bank Negara Malaysia (BNM), the International Trade and Industry Ministry (MITI), and the Royal Malaysian Customs Department to identify and resolve the issues preventing the Ringgit's strength from translating into lower prices for imported items.

"We understand the frustration of Malaysian consumers," the statement read. "The recent appreciation of the Ringgit should lead to reductions in the cost of imported goods, and we are committed to understanding why this isn't happening and to taking corrective action."

Digging Deeper: A Multifaceted Problem

The lack of price adjustment isn't a simple case of businesses ignoring currency fluctuations. Experts suggest a complex interplay of factors is at play. The MoF's investigation will focus on several key areas, including logistics costs, import duties, and retailer markup practices.

Logistics Costs: Global supply chain disruptions, while easing from pandemic peaks, continue to exert pressure on shipping rates and overall logistics expenses. Even with a stronger Ringgit, if global freight costs remain high, the benefit is partially offset. The investigation will assess whether Malaysian importers are absorbing these costs or passing them on to consumers.

Import Duties: While Malaysia employs a relatively open trade policy, certain imported goods are still subject to import duties. The MoF and MITI will review current duty structures to determine if adjustments are possible without compromising national economic interests. There's also scrutiny on whether companies are accurately declaring the value of goods to minimize duty payments, potentially leading to artificially inflated prices.

Retail Markups: This is arguably the most contentious area. The MoF acknowledges that retailer markups play a significant role in determining final consumer prices. The investigation will examine pricing patterns across different retailers and product categories, looking for evidence of excessive or unjustified markups.

Historical Context and Global Comparisons

This situation isn't entirely new. Historically, the pass-through effect of currency fluctuations to consumer prices isn't always immediate or complete. Several economic factors influence this, including the nature of the imported goods (raw materials versus finished products), the degree of competition within the retail sector, and the overall inflationary environment.

Compared to other Southeast Asian nations with similarly strengthening currencies, Malaysia's experience appears somewhat atypical. Indonesia, for example, has seen more noticeable price adjustments in imported goods following Rupiah appreciation. This suggests that specific Malaysian market dynamics are contributing to the current problem.

Consumer Pressure and Calls for Transparency

Consumer groups have been vocal in their dissatisfaction, accusing some businesses of prioritizing profit margins over passing on savings to consumers. Social media is flooded with complaints and calls for greater price transparency.

"Consumers deserve to know why they aren't benefiting from the stronger Ringgit," said Amelia Tan, spokesperson for the Malaysian Consumer Protection Association. "We need greater accountability from retailers and a more proactive role from the government in ensuring fair pricing practices."

Next Steps and Expected Outcomes The MoF has indicated that it expects preliminary findings from the investigation within the next four weeks. Potential outcomes include recommendations for adjustments to import duty structures, increased scrutiny of retailer pricing practices, and measures to enhance competition within the import and retail sectors. Furthermore, the BNM is also expected to publish a detailed analysis of currency pass-through rates in Malaysia, providing further insights into the issue.

The government hopes that a combination of these measures will restore consumer confidence and ensure that Malaysians fully benefit from the economic advantages of a strong Ringgit. The situation remains under close watch, with ongoing dialogue expected between the MoF, relevant agencies, and industry stakeholders.