Govt Reforms Supporting Ringgit's Strength Vs Regional Currencies

KUALA LUMPUR, Oct 16 (Bernama) -- The ringgit has shown stronger performance versus regional currencies, driven by investor confidence in the country's reform agenda.

Finance Minister II, Datuk Seri Amir Hamzah Azizan, said that their confidence is premised on the clear direction of the MADANI Economy Framework and the implementation of policy reforms, including the Public Finance and Fiscal Responsibility Act, as well as targeted subsidies for electricity, water, and diesel.

"The MADANI Economy Framework is further supported by policies such as the New Industrial Master Plan 2030, which outlines the country's investment strategies and focus areas to support the economic transition towards greater prosperity, sustainability, and inclusiveness," he said.

He said this in a written reply read by Deputy Works Minister Datuk Seri Ahmad Maslan during the question and answer session in the Dewan Rakyat today.

Amir Hamzah was replying to a question from Chong Zhemin (PH-Kampar) on factors supporting the encouraging performance of the ringgit, which is projected to rise to RM3.55 against the US dollar by end-2025.

According to the minister, the ringgit's performance this year has been driven by global market developments and strong domestic fundamentals, including the economy, inflation, and unemployment rates.

"With the shift in monetary policy stances of major global economies, particularly the United States which has begun lowering its base rate, investor sentiment has also shifted as the interest rate differentials start to narrow.

"This development has increased investor’s risk appetite for emerging market currencies, including the ringgit," he explained.

At the same time, he said the government and Bank Negara Malaysia (BNM) are also making coordinated efforts to encourage the repatriation and conversion of foreign investment income into ringgit by government-linked companies and corporates.

This has helped create more vibrant two-way flows in the domestic foreign exchange market, further supporting the strengthening of the local currency.

-- BERNAMA