Answer to Question #207085 in Macroeconomics for hafiz

Question

What happens to the demand for ringgit in the market for foreign-currency exchange?

Answer 1

The demand for a country’s currency depends on the terms of trade; Malaysia has a surplus (favorable) of exports against her imports according to the Government statistics for March and April (2021), the currency (Ringgit) value will rise and consequently appreciating the exchange rate leading to an increase in the demand for Ringgit in the foreign currency exchange market.