KUALA LUMPUR: As the ringgit continues to trade easier against the US dollar following Donald Trump’s presidential victory, Deputy Finance Minister Lim Hui Ying assured the public that Putrajaya has the right mechanisms in place to ensure that the local currency doesn’t slide further.
Lim said the government was aware that the ringgit and the currencies of emerging markets were being affected by the current geopolitical situation in the Middle East and also the recently concluded US presidential elections.
“Despite that, the positive prospects of the Malaysian economy, which includes the government’s commitment to carry out structural reforms, will give continuous support to the ringgit,” said Lim during a Question and Answer session in Parliament on Monday (Nov 11).
Lim also said Bank Negara Malaysia was always ready to intervene in the foreign exchange market to stem currency movements that are deemed excessive.
“Much earlier, the government and Bank Negara have also taken proactive steps to promote the use of local currency in international trade and investment.
“This allows efficient trade in the foreign exchange market,” said Lim.
At 8am on Monday (Nov 11), the ringgit weakened to 4.3850 against the US dollar from last Friday’s close of 4.3800.
The ringgit is being closely watched after it was one of the best-performing currencies in Asia, at one point trading the highest at 4.115 against the US dollar in September this year.
According to Lim, the government also plans to capitalise on its Asean chairmanship next year to promote the ringgit.
“The government will lead efforts to widen the use of regional currencies with other Asean countries,” added Lim.
Lim also said that Malaysia is set to benefit from its involvement in BRICS, the Organisation for Economic Co-operation and Development (OECD), and the Asia Pacific Economic Cooperation (Apec).
“Our standing at the international stage is set to improve and it will also increase the potential of Malaysia’s trade,” added Lim.
Lim was responding to Jimmy Puah (PH-Tebrau), who asked about Malaysia’s measures to stem the slide of the ringgit following Trump’s victory in the US presidential election.
Nazri Abu Hassan (PN-Merbok) then asked Lim about measures to address the rising cost of living that was affecting Malaysians.
Lim said the government has introduced several measures for that purpose, such as the revision of the rate and scope of Sales and Services Tax (SST), targeted subsidies, and among others.
Lim said the government was expecting the rise in the cost of living to be under control.
“We don’t deny that there will be minor increases due to external factors, the global commodity prices and issues concerning the supply chain,” said Lim.
“The government is committed to considering the need to increase national revenue to ensure that the people’s prosperity is our priority,” added Lim.
