Ringgit ends higher on Covid-19 stimulus package

27 Feb 2020 / 20:08 H.

KUALA LUMPUR: The ringgit closed sharply higher against the US dollar for the second consecutive day today, thanks to the 2020 Economic Stimulus Package that helped boost appetite in the market.

The local note finished strong at 4.2100/2200 against the greenback compared with 4.2230/2280 recorded at 6pm yesterday.

Earlier, the government introduced the economic stimulus package worth RM20 billion to safeguard the country’s economy from impacts associated with the Covid-19 outbreak.

Interim Prime Minister Tun Dr Mahathir Mohamad said the stimulus package would assist businesses most adversely affected by Covid-19 to facilitate their cash flow and reduce business costs,

Among the measures was to allow deferment of monthly income tax payments for businesses in the tourism sector from April to September 2020.

Dr Mahathir also assured that Malaysia has enough money to fund the stimulus package, alluding to the almost RM2 trillion of savings from Bank Negara Malaysia, Tabung Haji, Retirement Fund Inc (KWAP) and the Employee Provident Fund (EPF).

Today’s announcement of the stimulus package was Dr Mahathir’s second after 2003 when as the country’s fourth Prime Minister he tabled an RM8.1 billion economic package to deal with another global health-related crisis, the Severe Acute Respiratory Syndrome (SARS).

A dealer said the stimulus package helped ease worries in the market over growth outlook to the economy.

“The market reacted positively to the announcement. This also offset US dollar-sentiment, which demand has significantly increase as safe-haven assets following the Covid-19 outbreak,” he told Bernama.

Malaysia was among the earliest country that mounts a stimulus package to combat impacts from Covid-19 effectively.

Meanwhile, the ringgit was traded mostly higher against other major currencies.

It rose against the Singapore dollar to 3.0181/0264 from 3.0205/0245 on Wednesday, increased versus the Japanese yen to 3.8210/8308 from 3.8280/8335 and strengthened against the British pound to 5.4317/4459 from 5.4679/4761 yesterday.

The local note, however, depreciated vis-a-vis the euro to 4.6032/6154 from 4.5980/5047 previously. - Bernama

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