KUALA LUMPUR, Dec 2 — Malaysia’s central bank announced new measures today to encourage more domestic trade of the ringgit, as it looks to stem the currency’s recent slide against the surging US dollar.
Bank Negara Malaysia (BNM) said in a statement that exporters can only retain up to 25 per cent of export proceeds in foreign currency. Higher balances would need BNM approval, it said.
“Foreign currency arising from conversion of export proceeds will be used to ensure continuous liquidity of foreign currency in the onshore market,” the statement said.
All ringgit proceeds from exporters can earn a higher deposit rate of 3.25 per cent per annum, it added.
Speaking to reporters, Assistant Governor Adnan Zaylani said exporters are free to convert currency to meet up to six months of loan obligations that are not denominated in ringgit.
The new measures state that all payments among resident exporters should only be made in ringgit. Other measures to ease onshore hedging were also announced. — Reuters