Political instability blamed for ringgit’s slide against Singapore dollar

Political instability blamed for ringgit’s slide against Singapore dollar

The ringgit declined in the eight months since Pakatan Harapan took over, says report.

The ringgit has seen a drop since April, shortly before Pakatan Harapan came to power. (Bloomberg pic)
SINGAPORE:
The ringgit has weakened further against the Singapore dollar in the eight months since April, with one analyst saying the decline would continue into the next year, Singapore’s The Straits Times reports.

The ringgit was RM2.936 against S$1 in April, but was RM3.0525 as of yesterday.

The paper quoted an analyst at Fitch Solutions who attributed the ringgit’s fall to weak oil prices since October and the strong Singapore dollar.

But he also cited Malaysia’s politics as a reason.

“The ringgit will weaken due to continued political and policy uncertainty in Malaysia brought about by the ruling Pakatan Harapan coalition,” ST quoted Chua Han Teng, head of Asia Country Risk at Fitch.

Another analyst said the stronger Singapore dollar was timely for the city-state in the wake of a shortage of food supply from Malaysia.

Malaysia, which exports food stuff to Singapore, is considering a temporary ban on the export of eggs to address a local supply shortage that has pushed up egg prices.

The weaker ringgit also comes at a time when Singaporeans flock to Malaysia for their year-end holidays, and has translated to better sales for money changers across the republic.

Stay current - Follow FMT on WhatsApp, Google news and Telegram

Subscribe to our newsletter and get news delivered to your mailbox.