BNM measures will strengthen the ringgit - PM Najib

Bank Negara Malaysia's new measures to enhance the liquidity of the foreign exchange market, which came into effect on Dec 5, will strengthen the ringgit, says Prime Minister Datuk Seri Najib Tun Razak.

The central bank, as a regulator, adopted a prudent monetary policy which included the management of the exchange rate, which was carefully thought out, he said.

"I believe the measures (Bank Negara) announced last week will instill confidence in the market.

"(And) these measures, we believe, can strengthen the ringgit, God willing," said the prime minister, who is also Finance Minister, when commenting if Bank Negara's latest measures could stabilise the ringgit.

Earlier, he launched Iskandar Malaysia's tenth anniversary celebration here today.

The measures announced on Friday included allowing residents, including resident fund managers, to freely and actively hedge their US Dollars and Chinese Renminbi with an exposure of up to a limit of RM6 million per client per bank.

Residents with domestic ringgit borrowings, are free to invest in foreign currency assets both onshore and abroad, up to the prudential limit of RM50 million for corporates and RM1 million for individuals.

Another measure which took effect on Monday was to allow exporters to retain only up to 25 per cent of export proceeds in foreign currency and the remaining 75 per cent in ringgit.

At 4:46 pm, the ringgit was traded at 4.4400/4440 versus the US dollar versus 4.4470/4500 at 6pm on Monday. -- BERNAMA