Malaysia's currency curbs boomerang as capital flees bond markets
Singapore
WHEN Malaysia forced foreign investors in its markets to stop dabbling in offshore derivatives in its currency last year, its target was speculative pressure on the ringgit, but it appears to have shot itself in the foot.
The ringgit was the weakest currency in emerging Asia last year after China's yuan, prompting Malaysia's central bank to get a written commitment from foreign banks to stop trading ringgit non-deliverable forwards (NDFs), offshore contracts they use to hedge their exposure to the currency.
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