Lim points to US-China trade war among reasons for sluggish ringgit

29 Jun 2019 / 18:22 H.

GEORGE TOWN: Finance Minister Lim Guan Eng has attributed the current sluggish performance of the Malaysian ringgit to a combination of various factors, as well as the US-China trade war.

While the ringgit had appreciated slightly against the US dollar over the last trading day on Friday, it has also depreciated significantly against neighbour Thailand, whose baht had traded at a record high of close to 7.42 against RM1.

Lim said that the trade war has its impact on the ringgit so he urged the people to be patient and to wait until certain issues from the trade war were resolved.

Lim expects a clearer picture to emerge after the G20 Summit of countries this weekend, where US President Donald Trump met Chinese President Xi Jinping to hold talks on their trade differences.

“There is nothing much to add on. We leave it to the market forces to decide.”

The country’s fundamentals remained strong and its economic data has exceeded initial market expectations, Lim said after visiting a family whose home was razed to the ground here.

It has been pointed out that the ringgit was affected previously by the low global fuel prices, the depreciation of value in its key commodities, the 1MDB strategic investment fund, corruption and lack of investors’ confidence.

There was also a speculation that some mega-projects may end up as wasteful due to the lack of domestic demand.

Consumerism sentiment here is also tempered by the complaint about rising living costs despite the country’s inflation being listed at 0.2% in May.

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