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| Image source: www.malaysia-chronicle.com |
Questions have been flying around on the falling of Ringgit in year 2015. What have caused Ringgit to fall? Could it be considered as the crisis of Ringgit? Could it be any worse? The implementation of 6% GST is not serving the country? To challenge the doubtful of falling Ringgit, discussions have been conducted around, infinitely, indefinitely and indirectly. For simplicity of reading for all readers, we shall disregard all of the complex numerical terms, which includes the percentage, ratio, forex and whatever value against whatever currency. Below points could possible reflect the falling of Ringgit:
1) Tumble of crude oil price (since June 2014)
Globally, the supply of oil exceeds the demand, causing the price of oil tumbles. Oil is one of Malaysia’s main exports, so that’s why!
Read more: http://themiddleground.sg/2015/07/10/ringgit-falling-not-good-news/
2) Falling forex reserve (since early 2015)
Fuelling speculation that Bank Negara Malaysia (BNM) is digging into the reserves to shore up Ringgit. The lower a country’s forex reserves, the less it is able to do to shore up a sinking currency. Economists say many Malaysians are also sending their money overseas because the falling value of the Ringgit.
Read more: http://www.themalaysianinsider.com/malaysia/article/heres-why-the-ringgit-rout-isnt-slowing-and-how-bad-things-could-get
3) Devaluation of China’s renminbi (since August 2015)
China, the world's second-largest economy after the U.S., devalued its currency in a bid to help exporters. The country is grappling with a softening economy and wild swings in the stock market. A weaker renminbi implies cheaper Chinese exports, making goods produced elsewhere in the region less competitive
Read more: http://www.cnbc.com/2015/09/16/why-chinas-yuan-may-be-set-for-15-devaluation.html
4) Political scandal of Malaysia’s 1MDB debts (since July 2015)
Relevant or irrelevant, the weakening of Ringgit could be caused by this scandal, indirectly. In July, the Wall Street Journal published a report alleging nearly $700 million flowed from the 1MDB fund to Prime Minister Najib Razak's personal bank account. Najib has repeatedly denied any wrongdoing. Singapore and Switzerland have both suspended bank accounts tied to 1MDB and in the U.S., media reports said the Federal Bureau of Investigation (FBI) is investigating as well
Read more: http://www.cnbc.com/2015/09/24/
Stop wondering! Start pondering! Please help Mr. Ringgit!
1) Tumble of crude oil price (since June 2014)
Globally, the supply of oil exceeds the demand, causing the price of oil tumbles. Oil is one of Malaysia’s main exports, so that’s why!
Read more: http://themiddleground.sg/2015/07/10/ringgit-falling-not-good-news/
2) Falling forex reserve (since early 2015)
Fuelling speculation that Bank Negara Malaysia (BNM) is digging into the reserves to shore up Ringgit. The lower a country’s forex reserves, the less it is able to do to shore up a sinking currency. Economists say many Malaysians are also sending their money overseas because the falling value of the Ringgit.
Read more: http://www.themalaysianinsider.com/malaysia/article/heres-why-the-ringgit-rout-isnt-slowing-and-how-bad-things-could-get
3) Devaluation of China’s renminbi (since August 2015)
China, the world's second-largest economy after the U.S., devalued its currency in a bid to help exporters. The country is grappling with a softening economy and wild swings in the stock market. A weaker renminbi implies cheaper Chinese exports, making goods produced elsewhere in the region less competitive
Read more: http://www.cnbc.com/2015/09/16/why-chinas-yuan-may-be-set-for-15-devaluation.html
4) Political scandal of Malaysia’s 1MDB debts (since July 2015)
Relevant or irrelevant, the weakening of Ringgit could be caused by this scandal, indirectly. In July, the Wall Street Journal published a report alleging nearly $700 million flowed from the 1MDB fund to Prime Minister Najib Razak's personal bank account. Najib has repeatedly denied any wrongdoing. Singapore and Switzerland have both suspended bank accounts tied to 1MDB and in the U.S., media reports said the Federal Bureau of Investigation (FBI) is investigating as well
Read more: http://www.cnbc.com/2015/09/24/
Stop wondering! Start pondering! Please help Mr. Ringgit!
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