Bank Negara taking action to encourage flows into forex market

MALAYSIA’S government and central bank are taking coordinated action to further increase flows into the foreign exchange market to ensure the ringgit remains stable, Bank Negara Malaysia governor Abdul Rasheed Ghaffour said on Wednesday (Mar 6).

The ringgit, which declined to a 26-year low last month, has weakened about 3 per cent this year, though the central bank has said the currency is undervalued and does not reflect Malaysia’s positive economic fundamentals.

Abdul Rasheed said authorities were working with state-linked companies to encourage more consistent repatriation and conversion of their foreign investment income, and stepping up engagements with international investors.

“With the current ringgit undervaluation and ongoing and forthcoming investment opportunities, global investors stand to reap the benefits from participating in Malaysia’s growth prospects,” he said, according to the text of a speech at an event on Wednesday.

Malaysia’s economy was projected to grow between 4-5 per cent in 2024, supported by robust domestic demand, Abdul Rasheed said, adding that improvements in the global economy and tech sector were benefiting the country’s exports. REUTERS