Ringgit won't be pegged to US dollar, says Najib
MALAYSIAN Prime Minister Najib Razak said yesterday that he would not peg the ringgit to the United States dollar or implement capital controls, as he sought to calm fears about the sliding currency and capital flight from the country.
"The flexibility of our exchange rate is important to absorb global adjustments and volatility," Mr Najib said at a press conference in Putrajaya, local news website Malaysian Insider reported.
Mr Najib, who is also finance minister, said he had come to the decision because Malaysia's economic fundamentals remained sound and the devaluation of the ringgit was largely caused by the "overwhelming strengthening" of the US dollar, The Star reported.
The ringgit, which had weakened by 17 per cent against the US dollar this year, was steady yesterday after the premier's comments.
According to Mr Najib, Malaysia achieved gross domestic product growth of 4.9 per cent in the second quarter of this year, which reflected the strength of its economy.
But local analysts suggested that he might be highlighting the rosy side of the economy as he was fighting off allegations that he had moved huge funds from firms linked to the state investment arm 1Malaysia Development Berhad (1MDB) into his personal accounts.
Mr Najib has also faced criticism for taking his eye off an economy suffering from weak global commodity prices and falling domestic consumption, said the Malaysian Insider.
Meanwhile, Bersih, the coalition of non-governmental organisations planning to hold a rally in Kuala Lumpur on Aug 29 and 30 to call for Mr Najib to quit over the 1MDB allegations, may not proceed without police approval.
KL police chief Tajuddin Md Isa said yesterday that the organisers have failed to suggest alternative venues for the rally, after City Hall disallowed them from holding it at Merdeka Square and the open field of Padang Merbok, The Star reported.
The commissioner warned the organisers that swift action would be taken against the gathering should they decide to continue with it.
But Bersih chairman Maria Chin Abdullah said she had submitted the rally application on Tuesday, contrary to reports, the Malaysian Insider reported.