Your Euros Lost Twice This Autumn

The Big Story: Your Euros Lost Twice This Autumn

In mid-September, a €5,000 transfer brought about RM23,600. On Friday the same transfer brought roughly RM700 less. That is the same salary with less to live on, every month.

Almost all of that came from the euro. The ringgit has barely moved against the dollar since September, while the euro has fallen against the dollar, the pound and the ringgit.

The euros that stay at home are losing ground too. Prices across the euro area are rising at 3.8% a year, driven mostly by energy. Europe’s central bank raised interest rates in September, and the euro kept falling anyway.

Take Stefan, a German engineer in Penang. His salary comes in euros. His rent and his children’s school fees go out in ringgit, and his savings and pension sit in Germany. This autumn his money lost ground twice: the euros he sends buy fewer ringgit, and the euros he keeps buy less at home.

The part Stefan controls is which money does which job. A year of ringgit bills belongs in ringgit, so a bad month for the euro never reaches his rent. Money for retirement belongs in a portfolio spread across the world’s companies and currencies, such as Irish-domiciled accumulating funds, instead of a German savings account.

If your savings sit in euros at a bank back home while your life runs in ringgit, sorting out which money belongs where is a half-hour conversation. Book a time here.

What Else Is Moving

Wall Street set a record ahead of a big inflation week. The S&P 500, the index of America’s largest companies, closed at a record on Tuesday and ended the week about 1% higher. Minutes from the Federal Reserve’s September meeting showed most officials expect one more rate rise this year. The next test comes on Wednesday, when September’s US inflation figures are published. Forecasts point to a rise to around 3.6%, pushed up by record petrol prices. The Fed decides on 28 October.

Malaysia’s budget spends more and borrows less. Budget 2027, tabled on Friday, raises spending to RM510 billion and aims to narrow the gap between what the government spends and what it collects. Parliament debates it through November. Nothing in the measures reported so far targets foreign residents, and the ringgit ended the week flat against the dollar.

Britain’s Budget is just over two weeks away. Chancellor John Healey presents it on 28 October, the first under Prime Minister Andy Burnham and the same day the Fed decides. He has kept Labour’s promise not to raise the rates of income tax, VAT or employee National Insurance. That leaves pensions open to the usual speculation, including the tax-free cash you can take at retirement. Nothing on that has been proposed. One change is already law: from April 2027, unused pension savings count towards inheritance tax.

The Expat Takeaway

A record on Wall Street, two budgets and a weaker euro made for a busy week. Very little of it should change a long-term plan.

Currency is the part of a plan you can set up once and then stop checking. Three questions:

• How many months of local spending already sit in the currency you spend them in?
• If your home currency fell again from here, would anything in your plan have to change?
• Is your long-term money tied to one currency, or spread across the world’s companies?

The same move works in your favour if you earn in dollars or ringgit and are saving towards a life in Europe. Each transfer now buys more euros than it did in September. If the questions come back easy, this is a week to watch. If they don’t, the work was never about the euro.