Malaysian ringgit movements continue to be market determined: central bank-Xinhua

Malaysian ringgit movements continue to be market determined: central bank

Source: Xinhua| 2022-09-23 16:34:45|Editor: huaxia

KUALA LUMPUR, Sept. 23 (Xinhua) -- The Malaysian Central Bank said here on Friday Malaysian ringgit movements will continue to be market determined.

Bank Negara Malaysia (BNM) said in a statement that the bank continues to closely monitor and ensure orderly financial market conditions amidst external developments that have led to persistent strength in the U.S. dollar against almost all currencies, including the ringgit.

The dollar has strengthened significantly due to aggressive monetary policy tightening in the United States, it added.

It also said the tighter global financial conditions and higher volatility in the foreign exchange markets are not expected to derail Malaysia's economic growth.

According to the bank, the Malaysian economy expanded by 8.9 percent in the second quarter and will continue to be driven by further improvements in labor market conditions and higher tourism activities.

It also said Malaysia's exports are underpinned by its highly diversified products and markets.

The domestic financial system is well capitalized with ample liquidity, and financial intermediation continues to be supportive of the economy, it added.

The BNM also said that the foreign exchange market continues to function and intermediate effectively.

According to the bank, daily onshore foreign exchange transaction volume has been increasing throughout, reaching a current average of 13.3 billion dollars against 11.3 billion dollars in 2021, amid two-way flows.

Bond market activity remains healthy, and is well supported by institutional investors and financial institutions, it said.

It also said the BNM's market operations will ensure sufficient liquidity and orderly functioning of financial markets.

"Malaysia remains an open economy. Rather than resorting to capital controls or re-pegging of the ringgit, the policy priority now is to sustain economic growth in an environment of price stability and to further strengthen domestic economic fundamentals through structural reforms. This will provide a more enduring support for the ringgit," Bank Negara Malaysia Governor Nor Shamsiah said.