By Dzulkefly Ahmad

The Finance Minister or the Governor of Bank Negara Malaysia (BNM) must take the responsibility to allay the fears of the Malaysian public, particularly of the business community and investors, over the fate of the ringgit.

It is not good enough for BNM to issue instructions to inshore banks not to provide any foreign exchange offshore while disallowing trade higher than Thursday’s range .

While this may not amount to capital controls as such, it is certainly a sort of shutdown of the interbank forex market by BNM.

Why is it that neither the Finance Minister nor BNM has yet made an announcement to address the public’s fears?

The public needs to get clarity from the authorities concerned as to the total amount outstanding or demanded by way of outflow of funds.

An official statement might also mitigate panic selling by holders of Malaysian government securities and other bonds and prevent the black market from thriving.

To make matters worse, it is said that there is no official exchange rate now. The unofficial rate as of Friday is RM4.60 to the US dollar and RM3.50 to the Australian dollar.

A clarification from the Finance Minister or BNM Governor is critical in avoiding uncertainties and preventing panic selling.

Because of the inaction of the authorities and their silence over the matter, all that talk about making Malaysia an Islamic finance marketplace for the world is now looking like nothing more than mere hype.

Dr Dzulkefly Ahmad is Strategy Director for Parti Amanah Negara

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