Malaysian PM Najib: 'Excessive political speculation' behind ringgit slide

On Thursday, the ringgit ended at 4.0107 to the US dollar against the previous close of 4.0275.
On Thursday, the ringgit ended at 4.0107 to the US dollar against the previous close of 4.0275. PHOTO: AFP

PETALING JAYA (THE STAR/ASIA NEWS NETWORK) - The "excessive political speculation" is among several reasons behind the ringgit's slide against the US dollar, Malaysian Prime Minister Datuk Seri Najib Razak said Thursday.

Najib acknowledged the ringgit's troubles in a blog posting on his website, saying the political speculation had stirred sentiments against the government.

"The existence of political play and intense speculation has resulted in an uncertain sentiment towards the administration," he wrote on his NajibRazak.com blog.

He said other reasons behind the decline in the ringgit against the US dollar included the measures taken by the China government to lower their yuan currency, causing the collapse of other currencies in the Asean region.

"A decrease in the price of commodities like oil, palm oil and rubber has also led to a sharp fall in the euro, especially because Malaysia is a producer of such commodities," he added.

He said the expectation that the US would raise interest rates makes many investors around the world move their funds to the greenback.

"Facing with such internal and external factors including a 'negative picture' painted by some quarters on the country's economy, Bank Negara has shown that our economy is on the right track," Najib wrote, referring to the central bank.

"I am giving my assurance that the Government will do its best to manage this situation in order to stabilise the country's economy," Najib said.

On Thursday, the ringgit ended at 4.0107 to the US dollar against the previous close of 4.0275.

Bank Negara had said the country's economic growth slowed to 4.9 per cent in the second quarter of 2015, compared with 5.6 per cent in the preceding quarter, as exports decelerated.

The growth rate, nevertheless, was slightly higher than market expectation of a 4.8 per cent expansion for Malaysia's GDP in the three months to June.

Bank Negara's governor Tan Sri Dr Zeti Akhtar Aziz said the economy was projected to remain resilient and on a steady growth path.