Ringgit gains as Malaysia steps up coordination to lift currency

SYDNEY – Malaysia’s ringgit rose to a one-month high after policymakers ramped up their coordination with state-linked firms to lift the currency from a 26-year low.

The currency advanced as much as 0.6 per cent to 4.7185 per US dollar in early Asian trading on March 5, its strongest level since Feb 2.

The ringgit has been the best performer in Asia in the past week.

Against the Singapore dollar, the ringgit was up 0.2 per cent from Feb 1’s close to 3.5186 per Singdollar as at 12.55pm.

Policymakers have sought to drive more inflows into the market by urging state-linked firms to repatriate foreign investment income and convert it into ringgit more consistently.

Bank Negara Malaysia will enhance its engagements with corporates and investors to further encourage conversions and boost sentiment towards the ringgit, according to a statement on March 1.

“The conversion to ringgit moves may have helped” the currency in early trading, said Mr Saktiandi Supaat, regional head of forex research and strategy at Malayan Banking in Singapore.

The Malaysian authorities have said the ringgit should be stronger given the nation’s improving economic outlook.

The central bank is prepared to sell US dollars from its reserves to curb excessive moves in the ringgit.

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