PUTRAJAYA – Increasing the overnight policy rate (OPR) to shore up the ringgit is not the best idea, as this may jeopardise the people’s wellbeing, according to Communications Minister Fahmi Fadzil.
He said Bank Negara Malaysia (BNM) would still have the final say, although several unnamed quarters have suggested it to the central bank.
“I take note that certain parties have commented, I am unsure if this group wants the BNM to increase the OPR, but I expect that it would not help the people at this time.
“The prime minister has also stated his calculations. If (we) increase the OPR, the interest rate would be higher, but the effect is on the people,” he said during a post-Cabinet press conference at the ministry, today.
Asked about the diminishing value of the ringgit, Fahmi said Finance Minister II Datuk Seri Amir Hamzah Azizan and BNM governor Datuk Shaik Abdul Rasheed Ghaffour are monitoring the matter.
Fahmi also said that analysts have predicted the ringgit’s value would go up by the end of the year.
Yesterday, the ringgit fell to 4.7987 against the US dollar, nearly hitting its all-time low of 4.8850 in 1998 during the Asian financial crisis.
BNM governor Shaik Abdul Rasheed yesterday said the slide did not reflect the positive prospects of the Malaysian economy going forward, as growth this year will be driven by the improvement in external demand and strong domestic spending.
On other matters, Fahmi said a special meeting on the Johor-Singapore Special Economic Zone (SEZ) will be held on February 28.
It will be chaired by Prime Minister Datuk Seri Anwar Ibrahim, and will involve both Putrajaya and the Johor state government covering border, immigration and other outstanding issues. – February 21, 2024