iRinggit heading towards RM3 level against the US dollar
KUALA LUMPUR: The ringgit is heading towards the RM3 level against the US dollar boosted by domestic and external factors, Malaysian Institute of Economic Research executive director Prof Dr Mohamed Ariff said yesterday. However, when that will happen is anybody’s guess, he added, but expected the local unit to strengthen to between RM3.30 and RM3.35 versus the greenback by year-end.
Dr Mohamed was speaking to reporters on the sidelines of the launch here of the National Productivity Corporation’s productivity report 2006. In early trading yesterday, the ringgit breached the RM3.40 level against the US for a new nine-year high of RM3.39. According to a dealer at a local brokerage, local and foreign players bought the ringgit in reaction to China’s decision last Friday to lift interest rates and widen the yuan trading band. This is because China’s move may lead to the appreciation of the yuan, which could trigger a further strengthening of the ringgit.
The ringgit and yuan were depegged from the US dollar around the same time in July 2005. Dr Mohamed Ariff said the impact of the strengthening ringgit on exports should not be an issue as productivity is improving. “I think we should compete on a productivity basis,” he added. Malaysia registered an increase of 3.7 percent in productivity growth to RM27,221 per worker last year - the highest in the last six years.
Last year’s productivity growth surpassed that of some Organisation for Economic Cooperation Development (OECD) countries such as Sweden (2.8 percent), Japan (2.5 percent), Germany (2.0 percent), Denmark (1.8 percent), Britain (1.7 percent), the U.S. (1.5 percent), France (1.4 percent), Australia (1.0 percent), Canada (1.0 percent) and Ireland (0.9 percent) Malaysia was also ahead of Thailand (3.5 percent), Taiwan (2.7 percent) and Singapore (1.2 percent). –
Source : The Borneo Post
Dr Mohamed was speaking to reporters on the sidelines of the launch here of the National Productivity Corporation’s productivity report 2006. In early trading yesterday, the ringgit breached the RM3.40 level against the US for a new nine-year high of RM3.39. According to a dealer at a local brokerage, local and foreign players bought the ringgit in reaction to China’s decision last Friday to lift interest rates and widen the yuan trading band. This is because China’s move may lead to the appreciation of the yuan, which could trigger a further strengthening of the ringgit.
The ringgit and yuan were depegged from the US dollar around the same time in July 2005. Dr Mohamed Ariff said the impact of the strengthening ringgit on exports should not be an issue as productivity is improving. “I think we should compete on a productivity basis,” he added. Malaysia registered an increase of 3.7 percent in productivity growth to RM27,221 per worker last year - the highest in the last six years.
Last year’s productivity growth surpassed that of some Organisation for Economic Cooperation Development (OECD) countries such as Sweden (2.8 percent), Japan (2.5 percent), Germany (2.0 percent), Denmark (1.8 percent), Britain (1.7 percent), the U.S. (1.5 percent), France (1.4 percent), Australia (1.0 percent), Canada (1.0 percent) and Ireland (0.9 percent) Malaysia was also ahead of Thailand (3.5 percent), Taiwan (2.7 percent) and Singapore (1.2 percent). –
Source : The Borneo Post
1 comment:
Re: “The ringgit and yuan were depegged from the US dollar around the same time in July 2005.”
A “Federal Reserve Note” is not a U.S.A. dollar. In 1973, Public Law 93-110 defined the U.S.A. dollar as consisting of 1/42.2222 fine troy ounces of gold.
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