Malaysia cbank says ringgit move to boost trade
KUALA LUMPUR Aug 24 (Reuters) - Recent moves to allow the Malaysian ringgit to be used more widely for trade settlement will bolster this Southeast Asian country's trade with major Asian trading partners, the central bank said on Tuesday.
"The recent changes in the foreign exchange administration rules are part of the liberalisation process aimed towards achieving greater efficiency in the conduct of international trade as well as promote a conducive business environment and the use of domestic currency in the settlement of trade with its major Asian trading partners," Bank Negara Malaysia said in a statement.
The response came after a Reuters query on the deregulation measures announced last week which asked whether the move was a precursor to greater ringgit deregulation and whether offshore trade in the currency would be allowed. [ID:nSGE67H0GQ]
"The liberalisation is supported by adequate safeguard with requirement for all settlement in ringgit by non-residents to be conducted through the non-resident's ringgit account maintained with the licensed onshore banks or the external account of the appointed overseas branch within the same banking group of the licensed onshore bank," Bank Negara said.
"Therefore, the settlement of the ringgit remains with the licensed onshore banks," the bank said.
The ringgit has hit 13-year highs against the dollar, bolstered by the Malaysian bond market's use as a proxy for Chinese yuan revaluation, Bank Negara's rate hikes, better than expected economic growth and underperformance in 2009. [ID:nSGE67I06T]
Some traders speculated that last week's announcement was a precursor to the full internationalisation of the ringgit which cannot be traded overseas.
(Reporting by David Chance; Editing by Liau Y-sing)
KUALA LUMPUR Aug 24 (Reuters) - Recent moves to allow the Malaysian ringgit to be used more widely for trade settlement will bolster this Southeast Asian country's trade with major Asian trading partners, the central bank said on Tuesday.
"The recent changes in the foreign exchange administration rules are part of the liberalisation process aimed towards achieving greater efficiency in the conduct of international trade as well as promote a conducive business environment and the use of domestic currency in the settlement of trade with its major Asian trading partners," Bank Negara Malaysia said in a statement.
The response came after a Reuters query on the deregulation measures announced last week which asked whether the move was a precursor to greater ringgit deregulation and whether offshore trade in the currency would be allowed. [ID:nSGE67H0GQ]
"The liberalisation is supported by adequate safeguard with requirement for all settlement in ringgit by non-residents to be conducted through the non-resident's ringgit account maintained with the licensed onshore banks or the external account of the appointed overseas branch within the same banking group of the licensed onshore bank," Bank Negara said.
"Therefore, the settlement of the ringgit remains with the licensed onshore banks," the bank said.
The ringgit has hit 13-year highs against the dollar, bolstered by the Malaysian bond market's use as a proxy for Chinese yuan revaluation, Bank Negara's rate hikes, better than expected economic growth and underperformance in 2009. [ID:nSGE67I06T]
Some traders speculated that last week's announcement was a precursor to the full internationalisation of the ringgit which cannot be traded overseas.
(Reporting by David Chance; Editing by Liau Y-sing)