The Malaysian Ringgit Needs to Rely on the US Dollar - Dr Mahathir


 Deputy Minister of Finance, Steven Kim said that the Malaysian Ringgit (RM) has no plans to peg or impose exchange rate controls as happened during the 1997 Asian Financial Crisis.

He thought that the action was not a wise decision at a time when the Malaysian Ringgit (RM) plummeted to the level of RM4.77 against the US dollar.

Steven Kim also said that the country's economy and financial system are in a good position to face the global financial market.

Furthermore, Malaysia will lose monetary policy flexibility and will have to change interest rates according to the currency tied to the Malaysian Ringgit (RM).

He said pegging the currency also required large international reserves.

It is different from the point of view of Tun Dr Mahathir, the former Prime Minister of Malaysia regarding this issue because he thinks that pegging the currency to the US dollar is the best solution for now.

The move can also help ease the burden of the people's living costs which are getting steeper due to the dwindling value of the ringgit currency.

Dr Mahathir is of the view that pegging the currency will help reduce price pressure which is the main crisis now.

Malaysian assets have suffered losses this year due to a surge in interest rates raised by the United States as a step to revive the world's largest economy.