ASEAN Foreign Exchange Reserves Showdown: Indonesia Declines, Malaysia Triumphs

Global uncertainty continues to demand attention on foreign exchange reserves. Amid pressure from the US dollar, financial market turmoil, and geopolitical risks, foreign exchange reserves serve as a crucial buffer for a country. Reserves can be used as ammunition to maintain exchange rate stability, meet foreign currency needs, and pay external obligations. The larger the reserves, the greater a country’s capacity to absorb external pressures.

Among Southeast Asian (ASEAN) nations, the condition of foreign exchange reserves has moved in varied directions. Some countries managed to bolster their buffers, but Indonesia and the Philippines recorded declines. Based on data from Trading Economics, out of seven ASEAN countries, five recorded an increase in foreign exchange reserves. These countries are Malaysia, Singapore, Vietnam, Thailand, and Laos. Meanwhile, Indonesia and the Philippines were among those experiencing a contraction.

Indonesia was one of the ASEAN countries that recorded a decline in foreign exchange reserves. Bank Indonesia (BI) reported that Indonesia’s foreign exchange reserves position at the end of May 2026 stood at US$144.9 billion. This figure fell by US$1.3 billion compared to the previous month’s position of US$146.2 billion. BI explained that the development of foreign exchange reserves in May 2026 was influenced by the government’s global bond issuance as well as tax and service revenues. However, reserves were also used for government external debt payments and rupiah exchange rate stabilisation policies. Pressure on the rupiah remains a major concern. Amid global financial market volatility, the need for exchange rate stabilisation can reduce foreign exchange reserves because the central bank needs to prevent the rupiah from weakening too sharply. Despite the decline, Indonesia’s foreign exchange reserves position is still considered strong. The reserves are equivalent to financing 5.6 months of imports or 5.5 months of imports and government external debt payments, and remain above the international adequacy standard of around 3 months of imports.

Besides Indonesia, the Philippines also recorded a decline in foreign exchange reserves. The Philippines’ reserves position fell from US$104.3 billion to US$104.0 billion in May 2026, representing a decrease of approximately US$0.3 billion in a month.

On the other hand, most ASEAN countries managed to increase their foreign exchange reserves. Malaysia recorded the largest increase on the list. Malaysia’s foreign exchange reserves rose from US$113.8 billion to US$130.6 billion in May 2026, marking an addition of US$16.8 billion in just one month. This increase makes Malaysia’s reserve position one of the most notable in ASEAN. While several countries still face exchange rate pressures and capital flows, Malaysia was able to significantly thicken its reserve buffer. Vietnam also recorded an increase in foreign exchange reserves, rising from US$81.4 billion to US$83.6 billion, an addition of approximately US$2.2 billion. However, the latest data for Vietnam is available for the December 2025 period, so its reporting period differs from the majority of other countries which have already reported data for May 2026. Thailand also recorded a slimmer increase. The White Elephant Country’s foreign exchange reserves rose from US$286.9 billion to US$287.5 billion in May 2026, an addition of approximately US$0.5 billion. Laos also recorded a small increase, with its reserves rising from US$4.2 billion to US$4.3 billion in April 2026.

Singapore also recorded an increase in foreign exchange reserves. However, it should be noted that Singapore’s data in this list uses Singapore dollars (SGD), not US dollars. Singapore’s foreign exchange reserves rose from SGD544.1 billion to SGD548.6 billion in May 2026, meaning its reserves increased by approximately SGD4.5 billion in a month. This increase shows that Singapore still possesses a very large reserve buffer to face external pressures. As one of the largest financial centres in Asia, Singapore’s foreign exchange reserves position is important because the country is highly connected to global trade and financial flows.