Ringgit gains as Malaysia steps up coordination to lift currency

MALAYSIA’S ringgit rose to a one-month high after policymakers ramped up their coordination with state-linked firms to lift the currency from a 26-year low.

The currency advanced as much as 0.6 per cent to 4.7185 per US dollar in early Asian trading, its strongest level since Feb 2. The ringgit has been the best performer in Asia in the past week.

Policymakers have sought to drive more inflows into the market by urging state-linked firms to repatriate foreign investment income and convert it into ringgit more consistently. Bank Negara Malaysia will enhance its engagements with corporates and investors to further encourage conversions and boost sentiment towards the ringgit, according to a statement on Friday (Mar 1).

“The conversion to ringgit moves may have helped” the currency in early trading, said Saktiandi Supaat, head of foreign exchange research at Malayan Banking in Singapore.

Malaysian authorities have said the ringgit should be stronger given the nation’s improving economic outlook. The central bank is prepared to sell US dollars from its reserves to curb excessive moves in the ringgit. BLOOMBERG