Saturday, July 23, 2005

Ringgit unpegged

As of Thursday, Bank Negara has decided to remove the ringgit peg to US dollar after China decided to do so. Some say it's a timely move which should have been done a long time ago[reason:RM is undervalued]. For me, it's good news and bad news rolled into one. Although value of RM would probably remain at the present level in the short term, it'll probably rise in the long term. Good news - sterling would be cheaper to buy. Bad news - converting sterling to RM would give less RM than before. Probably those with sterlings are rushing to convert them to RM now before the rate falls further. I know one lady did. My mom saw her exchanging lots of sterling the other day. Good move? Probably. If what they say about RM being undervalued is true. But then, reading today's paper showed that RM actually fell against sterling? haha..Looks like we have to wait and see. To Asma' - RM rose against Euro. So what are you going to do?

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