EMERGING MARKET CURRENCIES

EMERGING MARKET CURRENCIES

Bank Negara To Return Ringgit Peg But Strengthening Pressure Mounts

Bank Negara, Malaysia’s central bank, said on March 30 that it believed the ringgit was between 6 per cent and 8 per cent overvalued. However, it said that it could see no compelling reason for it to adjust its 19-month-old currency peg.

The ringgit was pegged to the dollar at MYR3.80/$ as part of capital controls to stem short-term flows during the second wave of the Asian crisis in 1998.

Analysts had expected that Bank Negar