Illustrative image (Photo: Bernama) Kuala Lumpur (VNA) - Malaysia's ringgit is expected tocontinue to strengthen this year, trading at 4.5 RM against the US dollar byyear-end, driven by the country’s positive economic performance, Finance Minister II Amir Hamzah Azizan has said.
Coordination between the Ministry of Finance and Bank NegaraMalaysia (BNM), as well as joint efforts between government-linked investmentcompanies (GLCs) and government-linked companies (GLICs) will help increaseinflow into the foreign exchange market and strengthen the ringgit’s value, hesaid at the question and answer session in the House of Representatives.
He also said BNM is also always ready to intervene in theforeign exchange market to curb currency movements that are consideredexcessive.
According to Azizan, the efforts made by the government areeffective and there is no need to use instruments such as pegging the ringgitor shutting down the ringgit exchange as was done during the Asian FinancialCrisis.
He said the ringgit’s current depreciation is largely drivenby the strengthening of the US dollar and the uncertainty over China’s economicgrowth, which has also affected other regional currencies.
As of February 28, the ringgit has depreciated 3.5% againstthe US dollar, in tandem with regional currencies such as the Japanese yen(-6.3%), the Thai baht (-4.7%) and the Korean won (-3.3%).
Azizan said BNM monitors the conversion of export proceedsinto ringgit by exporting companies, and is continuing efforts to encourage theringgit’s use for export settlements to reduce dependence on the US dollar.
The government also controls overseas investments by privatecompanies to reduce pressure on the ringgit, including encouraging them toprioritise domestic investments as well as delaying new overseas investments,he added./.
