S&P predicts 9% rebound in ringgit by end 2024


PETALING JAYA: S&P Global Ratings forecast a 9% rebound in the Malaysian ringgit by the end of the year, and said the weak currency doesn’t pose a risk to the sovereign rating.

"We do not see the depreciating ringgit as a risk to the sovereign rating,” said YeeFarn Phua, sovereign analyst at S&P in Singapore.

"Malaysia’s external position remains strong, augmented by adequate foreign reserves and consistent current-account surpluses.”

The ringgit slid to the lowest level in 26 years this week as China’s sluggish economy hurts Malaysian exports, and some analysts have said there is a risk the currency will reach a new record low.

The currency, which traded at RM4.79 per US dollar on Thursday (Feb 22), is expected to climb to 4.40 by the end of the year and 4.30 by end-2025, Phua said in an email on Thursday.

S&P joins Moody’s Investors Service in highlighting the safety of the nation’s credit rating despite the ringgit’s weakness, as almost all the nation’s debt is denominated in the local currency.

The government’s foreign debt was about RM30bil (US$6.26bil) at the end of 2023, just under 3% of the total, S&P estimated.

Malaysia is rated A- at S&P since 2003, signifying its strong ability to pay debt. The credit score, the highest among peers in developing South-East Asia, has withstood the fallout from the 2008 global financial crisis as well as the turmoil caused by the pandemic. - Bloomberg

Follow us on our official WhatsApp channel for breaking news alerts and key updates!

Ringgit , S&P , Rebound

   

Next In Nation

20 Malaysians to join Freedom Flotilla Coalition mission to Gaza
Chegubard, Papagomo summoned to give statements over social media posts
Sembrong Dam to be upgraded to address water woes in Kluang
Three nabbed for robbing varsity students in Pagoh
Court rejects 1MDB’s bid to transfer Arul Kanda, Irwan’s US$6.5bil case to another judge
Middle East crisis: No instruction yet to bring back state-sponsored students, says Abang Jo
Perak proposes new highway linking Tanjung Malim and Lumut
Three killed, three more injured in seven-vehicle pile-up
Sabah couple charged with causing hurt to two boys
KKB by-election: Bersatu sets up special committee to look into needs of Indians, Orang Asli

Others Also Read