Bank Negara has enough ‘ammunition’ to stop ringgit and sovereign rating decline

Capital volatility: Lee says aggressive currency market intervention may be futile and extremely costly.

PETALING JAYA: Concerns that Malaysia’s external finances may worsen, as a result of continued intervention from the central bank after the ringgit weakened beyond 3.8 to the US dollar, have renewed fears that could lead to a sovereign rating downgrade.

BNP Paribas said the foreign exchange (forex) reserves depletion to prevent the ringgit from breaching the psychologically important RM3.81-a-dollar level was especially concerning, as it heightened the risk of balance of payment strains.