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Ringgit's weakness is short term, says Treasury sec-gen

The ringgit's current weakness is short term, says Treasury Secretary-General Mohd Irwan Serigar Abdullah.

He said the local unit would strengthen over the long term with incoming foreign direct investments (FDIs), as well as a number of government projects to be implemented next year.

"Malaysia's economy is strong and oil prices are stable in not having gone below US$40 (a barrel). The global economy is slightly slow this year, but hopefully, it will improve.

"So, I don't see why the fear over the ringgit's weakness. We are growing but because of some quarters saying negative things, it impacts perception of the country," he told reporters at the National Code Challenge (II) 2016 closing ceremony, here today.

Weak sentiment towards emerging currencies, brought on by speculation of a December US interest rate hike has pushed the ringgit to depreciate against the greenback.

The ringgit opened today at 4.4500/4600 to the greenback from 4.4400/4450 on Wednesday. It closed slightly higher at 4.4450/4550.

At 9.05am, the local unit was traded at 4.4500/4600 to the greenback from 4.4400/4450 yesterday.

At 10am today, Bloomberg reported that the ringgit reached the point of 4.4675 to US$1.

According to Bernama, despite higher overnight crude oil prices, which sometime provided support to the ringgit, investors accumulated position for the US dollar.

The greenback rose to a 14-year high against a basket of currencies following upbeat economic data that showed US economy on track for steady growth.

On the local front, Bank Negara Malaysia yesterday maintained the overnight policy rate at 3.0 percent and also kept the statutory reserve requirement ratio at 3.5 percent.

The central bank said it would continue to provide liquidity to ensure the stability of the domestic foreign exchange market.

BNM said the risk of destabilising financial imbalances were contained, but would continue to monitor them.

Against other major currencies, the local unit traded mostly higher.

The ringgit rose against the Singapore dollar to 3.1013/1086 from 3.1136/1175 on Tuesday, strengthened versus the yen to 3.9534/9655 from 3.9993/4.0049, and expanded against the euro to 4.6872/6995 from 4.7117/7175 previously.

However, the ringgit depreciated vis-a-vis the British pound to 5.5327/5473 from 5.4945/5011 yesterday.