MALAYSIAN Prime Minister Anwar Ibrahim said the ringgit’s slide this week to its lowest level since the Asian financial crisis is “concerning” and that the authorities are watching the currency’s fluctuations.
“We have assigned the central bank to monitor, but it is affecting all countries,” Anwar told reporters on Friday (Feb 23). “Ideally, the ringgit should be under control.”
The local currency briefly slipped past 4.8 against the dollar this week, the weakest level since January 1998, the height of the crisis that roiled Asian financial markets.
Sputtering growth in China, Malaysia’s biggest trading partner, has weighed on the export-reliant economy. Economists have lowered their forecasts for 2024 gross domestic product growth to 4.3 per cent from 4.5 per cent, after last year’s expansion missed estimates.
Malaysia’s wide interest rate gap with the US also dimmed the allure of its assets, while concerns over political stability linger.
The ringgit – emerging Asia’s worst performer last year – has slid almost 4 per cent in 2024. It fell 0.1 per cent to 4.7782 as of 12.30pm in Kuala Lumpur, after strengthening in the previous two days.
Bank Negara Malaysia Governor Abdul Rasheed Ghaffour said on Tuesday that external factors are hurting the ringgit and that its current level doesn’t reflect “the positive prospects of the Malaysian economy going forward.”
The nation’s exports in January grew by 8.7 per cent year-on-year, ending 10 consecutive months of contraction. Anwar said on Thursday that Malaysia’s approved investments hit a record high last year. BLOOMBERG
