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PUTRAJAYA – The ringgit depreciation starting from February is the result of a series of crises in the United States that are beyond the government’s control, said Economy Minister Rafizi Ramli.
He said that since the beginning of 2023, US faced issues such as Silicon Valley Bank’s collapse and the ongoing US debt ceiling limit impasse.
“However, if you look at the performance of the ringgit from December 2022 to early February, it was robust and safe, but external factors caused it to decline again,” said Rafizi.
“Part of it is because there is political stability, (there was) good economic performance until it reached RM4.20 for US$1.
“But starting February, the value of the ringgit decreased (US$1=RM4.60) due to a series of crises which are beyond our control,” he said during a media conference after the platform meeting of the special task force on Permudahcara Perniagaan (Pemudah) Bilangan 3/2023 here today.
The ringgit opened weaker against the US dollar in early trading today amid a lack of indication of a resolution to the US debt ceiling impasse.
At 9.05am, the local currency depreciated to 4.6025/6060 against the US dollar from yesterday’s close of 4.6005/6045.
The US government is reportedly trying to resolve the debt ceiling issue as soon as possible, while US President Joe Biden also mentioned that his administration will try to resolve the issue before June 6.
According to Rafizi, if the US government’s debt ceiling and national budget are not resolved, there is a risk that the US government will not be able to pay its debts and it will contribute to the uncertainty of the local currency rate. – Bernama, May 31, 2023