Second finance minister says there is no need as the Malaysian economy would adjust accordingly to overcome economic uncertainties.
KUALA LUMPUR: The finance ministry has ruled out the possibility of a budget recalibration despite the weaker ringgit/US dollar environment.
Second Finance Minister Johari Abdul Ghani said there was no need for a budget recalibration as the Malaysian economy would adjust accordingly to overcome adversities, including the weak ringgit.
“The economic fundamentals are OK. We just need to give time for everybody to do the adjustment.
“(Then) the market will come back and the currency will strengthen again,” he told reporters on the sidelines of the International Investment Fund Forum 2017 here today.
Johari said one of the factors that contributed to the weakening ringgit was the anticipation of US President-elect Donald Trump implementing an inward-driven economic policy which would lead to an interest rate hike in the world’s largest economy.
“If the yields (there) increase, then the whole spectrum of investment in Asia will slowly change because people will go for better yields in the US,” he said.
Johari also dismissed any speculation of the government reintroducing capital controls as it was not in sync with the country’s open economic policy.
“We are not going to do any pegging and we will not control our capital flows.
“We will allow any investor who wishes to repatriate funds from Malaysia to do so,” he added.
The one-day forum, organised by the Securities Commission Malaysia, is in conjunction with the launch of Malaysia’s Islamic Fund and Wealth Management Blueprint.