Zafrul: Govt not 'too fixated' on ringgit performance, focused on economy

Finance Minister Tengku Zafrul Abdul Aziz has brushed off concerns regarding the ringgit’s performance.

He was cited by Bernama as saying that the government would not be “too fixated” on how the currency was doing as the focus remained on the mid-to-long term performance of the economy.

“You have to understand the inflation rate in the US. The monetary tools that are available in Malaysia or other markets depend on the economic scenario of the particular country.

“The inflation rate in Malaysia in the first six to seven months (of 2022) is 2.8 percent, so we could have an accommodative economic policy, (with) very large fiscal support,” Zafrul (above) was quoted as saying.

The ringgit has slid against the US dollar to its lowest since January 1998, months after the onset of the Asian Financial Crisis.

The local currency closed at RM4.50 against the greenback again today.

The US dollar is performing stronger due to increasing demand in anticipation of further rate hikes.

However, MIDF Research expects the ringgit to recover and appreciate towards RM4.35 against the dollar by the end of the year.

Zafrul had been criticised for not commenting on the ringgit’s drop.

Meanwhile, Zafrul said the country’s economic growth is expected to surpass official estimates of between 5.3 and 6.3 percent in 2022.

He said this is due to faster growth in the second quarter at 8.9 percent, with expectations of a strong performance in the third quarter. - Mkini