KUALA LUMPUR: Regional currencies including the ringgit are expected to do better against the US dollar in the coming year, backed by news and indicators that the US Federal Fund Rate is possibly close to a peak.
Bank Negara Malaysia (BNM) deputy governor Adnan Zaylani Mohamad Zahid said Malaysia’s fundamentals are also looking positive with the government’s announcements on various development projects related to infrastructure, energy transition, and the New Industrial Master Plan (NIMP 2030).
“If the scenario plays out where global developments see a peak in interest rates in developed markets next year, or even as we speak, then the region’s currencies as a whole, including the ringgit, are expected to do better.
“However, we cannot take that for granted. BNM will continue to monitor and take our actions appropriately in the market, and continue to work with the financial industry and the media to understand the need for a balanced narrative,” he told the media at a BNM Media Workshop 2023 here yesterday.
He said sensationalising biased coverage introduces fear and the media has the responsibility and power to ensure public confidence and trust because the public is susceptible to psychology anchoring and if the public anchors to something specific, it may become a self-fulfilling prophecy.
After 11 increases since March 2022, the benchmark Fed rate is now between 5.25 per cent and 5.5 per cent.
Elaborating on the government’s effort to reduce ringgit volatility, Adnan Zaylani said this is BNM’s mandate and initiatives have been taken over the past year. – BERNAMA
