Nov 20, 2014

    Ringgit at new multi-year low against USD


    THE ringgit has fallen to a fresh multi-year low against the United States dollar, as sentiment has been somewhat dented by Malaysia's shrinking current account surplus and slower economic growth in the third quarter of this year.

    At 5pm on Tuesday, the ringgit was being traded at 3.3565 against the greenback - the weakest level since May 2010. The ringgit is the second-worst performer in the region after the Singapore dollar so far this year. Over the last two weeks, it had declined 2 per cent against the greenback.

    Bank Negara, however, dismissed any notion that the narrowing current account surplus is a matter of concern.

    "At this stage, with our current account surplus standing at about 3 per cent of gross domestic product (GDP), it is considered a good sign… it is still positive," Bank Negara governor Zeti Akhtar Aziz said.

    "It (current account surplus) is actually better than what we expected because we (had earlier) thought that the rapid investment growth (in the country) would actually result in (current account) deficits in some quarters. But it did not (happen)," Dr Zeti told reporters after delivering a keynote address at the inaugural International Statistical Institute Regional Statistics Conference here on Tuesday.

    Malaysia's GDP growth slowed to 5.6 per cent in the three months to September, from 6.5 per cent in the preceding quarter, according to data released last Friday.

    It was disclosed that the country's current account surplus had narrowed sharply to RM7.6 billion (S$2.9 billion) in the third quarter, from RM16 billion in the second quarter.