THE VALUE OF THERINGGIT FALLING CREATED BY: KIRTHANA, DARSHINI,PAVISHAA,VALARMAT HI AND MAITHURI 0025 against the dollar .7743 On 9 June 2015. the ringgit had dropped to its lowest level in 16 years on 12 Aug 2015. fell to lowest value against the Singapore Dollar on 6 July 2015. the ringgit fell to Rm4. the ringgit dropped to 3.4455 in the 1st quarter of 2015.INTRODUCTION before closing on 3 Dec 2014. the ringgit’s value continued to weaken on 8 June 2015. the ringgit dropped to as far 3. 4% to 3.4300 to the US dollar on 12 June 2015. the ringgit had dropped for 4 consecutive weeks the ringgit has become Asia’s worst performing currency last year. 2nd worst performing currency in the region investors continue to scale down their exposure to Malaysia assets . on 1 Dec 2014. falling 2.HOW BIG WAS THE DROP AND WHEN DID IT START the ringgit started falling in late 2014. the lower value oil . Malaysia’s 1MDB debt have gained global attention In July 2015.ISSUES… Firstly. prospect of the US increasing its interest rates. . media reports that our PM’s personal accounts were involved in the transfer of USD700 million of 1MDB Thirdly. Oil is one of Malaysia’s main exports declining price of Brent crude oil of 38% Secondly. WHAT CAUSED THE DROP IN OIL PRICES? the supply has been exceeding demand the price of Brent crude oil has now fallen to a 4 year low OPEC. has so far declined to cut back on its production of oil . 49 per dollar the ringgit would continue to fall until oil prices stabilize June 2015. the Financial Times reported that some banks have predicted the ringgit will sink as low 3.38 per dollar to 3.7050 per dollar In July 2015. central bank governor DR Zeti Aktar Aziz believed the weakening currency to be a short term problem on 19 June 2015.38 . ringgit pulled back against the US dollar .WHAT ARE THE PREDICTION FOR THE RINGGIT? ringgit forecast from 3.its value rising 3. HOW DOES THE FALLING RINGGIT AFFECT MALAYSIA’S CURRENCY RESERVES? Large amounts of currencies held by governments as part of their foreign exchange reserves examples. paying for imports and paying off foreign currency debts pricing currencies for globally traded products countries will keep different reserve currencies US dollar is a dominant reserve currency . WHY ARE MALAYSIA’S RESERVES FALLING RIGHT NOW? Bank Negara Malaysia has been intervening to help slow down the rate by buying and selling foreign reserve currency example slump oil prices and US interest rate 1MDB scandal are also affecting investors’ confidence . POSITIVE ANS NEGATIVE EFFECTS OF THE RINGGIT’S FALL Increased price of goods and services • GST imposed on the things you love • Increased cost of imported goods will be reflected on price tags • Disdain over the price imported fresh goods Inflation • cost of imported goods will increase as mentioned early • Domestic product forced to sell their goods on high price . CONTINUE…. there is no better time to visit Malaysia as the weak ringgit gives you more value for your money . Reduced purchasing power • when the price of goods and services increase. but your income is not • increased cost of goods does not permit you to spend freely Exports growth • international markets will find weak ringgit beneficial as they enjoy higher sales volume Tourism boost • weaker ringgit as it grants them a higher purchasing power • Singaporeans who enjoy a quick gateway to Malaysia would like be the prime benefit • For foreigner. CONCLUSION Many Singaporeans might be delighted because their weekend shopping trips to neighbour JB are now cheaper. weak Malaysian economy is bad news for Singapore as our largest trading partner. Malaysia’s easily problem are deep rooted and will not be solved .
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