Pressure on ringgit remains unabated

Yesterday, the ringgit hit a fresh 17-year low of 3.8517 against the greenback. Year-to-date, the ringgit has lost about 8.4% against the US dollar, making it the worst-performing currency in Asia. Dr Suresh Ramanathan, an independent interest rate and foreign exchange strategist, is, however, not overly pessimistic about the ringgit

PETALING JAYA: At RM3.85 to the US dollar, the selling pressure on the ringgit remains unabated on the back of two probable developments – first, the widely speculated put option that traders had gone into a few months ago offering RM4 for every US dollar.

The second is the arbitrage difference between the non-deliverable forward (NDF) ringgit offshore contract versus the onshore ringgit forward contract.