Surprise! Today, effective immediately, Malaysia and China have abandoned their currency pegs against the US dollar. Both countries ban offshore trading of the ringgit and yuan respectively, so there wouldn’t be an astronomical appreciation of either currency.
Plus, both countries aren’t allowing a free float, rather they are allowing currencies to move within limited trading bands structured around trade-weighted currency baskets. Malaysia’s central bank Bank Negara has been purchasing dollars en masse to head off an surge for the ringgit. More here. Updated for clarity
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July 24th, 2005 at 10:34 am
I’m surprised China’s announcement had so much influence over Malaysia’s own decision. Does anyone know whether China informed Malaysia prior to its own annoucement?
August 1st, 2005 at 1:55 pm
It’s ok malaysia and china have abandoned their currency pegs against the US dollar. But they cannot beat us dollor. Quite intresting article posting.I enjoyed reading this.
August 1st, 2005 at 1:58 pm
This is a good symbolfor both china and malaysia relationship.