Finance Minister assures ringgit will strengthen against US dollar

Strong economic fundamentals and prudent ringgit management are expected to contribute to the strengthening of the ringgit against the US dollar despite several temporary factors that have contributed to the ringgit's current depreciation, Minister of Finance Tengku Zafrul Abdul Aziz said.

He said that based on current factors, the ringgit’s value is expected to remain stable as Bank Negara Malaysia actively manages the local unit to ensure that fluctuations are orderly and not excessive, allowing the economic sector to make investment and expenditure plans based on a more stable value of the ringgit.

“What is more important are our economy’s strong fundamentals such as the country’s continued economic growth prospects,” he said in a statement today.

He said the ringgit would continue to strengthen as the economy expanded by 3.6 percent in the fourth quarter of 2021 and five percent in the first quarter of 2022.

“This is also reflected in the most recent International Monetary Fund analysis, which projects 5.75 percent GDP growth for Malaysia in 2022 driven by pent-up domestic demand and continued strong external demand.

“At the same time, the expectation of a current account surplus means that demand for the ringgit will remain strong,” he said.

Moving forward, Zafrul said the Finance Ministry (MOF) is optimistic about the country’s economic growth prospects with Malaysia’s GDP expected to grow between 5.3 and 6.3 percent in 2022, contributing to the ringgit’s stability.

“The MOF and Bank Negara will continue to monitor both financial and non-financial risks to the national economy in order to maintain economic stability and the well-being of all Malaysians,” he added.

- Bernama