Declining Fixed Deposit Interest Rates and Currency Value in Malaysia

June 20th, 2009 stephen.wong

Malaysian Ringgit has recently been on a decline against the Singapore dollar.

Limsimi.com - Singapore Dollar/ Malaysian Ringgit Comparison

From a low of 1 Singapore Dollar = 2.32 Malaysian Ringgit in March 2009, it is now 1 Singapore Dollar = 2.43 Malaysian Ringgit!

In addition, fixed Deposit Rates in Malaysia has recently been on a decline. From a high of 4.5% pa that we see last year, we now see most banks offering FD rates at 2.5% pa.

Examples include (assuming 12 months tenure):
Deutsche Bank (Malaysia) Berhad – 2.5% pa
RHB Bank Berhad – 2.5% pa
United Overseas Bank (Malaysia) Berhad – 2.5% pa
Hong Leong Bank Berhad – 2.5% pa

Therefore the Golden Question: Should put your money into Malaysian Fixed Deposit?

If you have spare funds to invest, consider taking a closer look into Unit Trusts or Defensive Stocks in Malaysia (for example, Telekom Malaysia), which may bring higher returns than Fixed Deposit. Alternatively, investing in commodities (like Gold) and real estate could be feasible options too.

With inflation in Malaysia hovering around 2-3% this year, the Fixed Deposit rate in Malaysia is clearly not catching up.

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Disclaimer/Disclosure Statement: Limsimi.com is not an investment advisor and any reference to specific securities/ investment mode does not constitute a recommendation thereof. The opinions expressed herein are the express personal opinions of the author. Neither the information, nor the opinions expressed should be construed as a solicitation to buy any securities or to invest. Examples given are only intended to make investors aware of the potential rewards of investing. Investors are recommended to obtain the advice of a qualified investment advisor before entering into any investment transactions.

Entry Filed under: Business and Investment