Ringgit’s fall needs balanced response from govt for benefit of people, investors - PM

KUALA SELANGOR: The fall of the ringgit is a serious challenge and requires the government to take a smart approach that won’t burden the people.

Prime Minister Datuk Seri Anwar Ibrahim said the government, at the same time, also needs to take a balanced approach to maintain investor confidence.

“When the ringgit fell, one of the solutions offered was to increase the Overnight Policy Rate (OPR).

“However, that step can result in an increase in interest rates for car loans, housing loans and loans to small traders. This can result in a higher debt burden for those with such loans,“ he said during the closing ceremony for the Central Zone MADANI Rakyat Programme at the Kuala Selangor Sports Complex here today.

Anwar explained that the OPR was raised during the 1998 Asian Financial Crisis because the inflation rate at the time was rising sharply, and investments were also lacking.

“Therefore, measures to curb the current fall in the ringgit must be taken with care.

“The economic condition now has shown that although the ringgit’s value has fallen, inflation is also falling, and investments in the country are rising.

“For example, investments in 2023 were at a historic high, demonstrating investor confidence towards the country’s political stability and economic policies,“ he said.

The Prime Minister added that Malaysia’s political stability and clear economic policies are important factors that attract investors, and such policies must be maintained to ensure the people’s welfare as well as to maintain investor confidence to continue investing in Malaysia. - Bernama