Kuala Lumpur: The ringgit is moving in the right direction despite the uncertainties caused by the United States' trade war, said Bank Negara Malaysia (BNM) governor Datuk Seri Abdul Rasheed Ghaffour. He emphasised that Malaysia's strong fundamentals and positive prospects are key factors supporting the ringgit.
According to BERNAMA News Agency, Abdul Rasheed asserted that the narrowing interest rate differential should bode well for the ringgit. He highlighted the strong economic fundamentals and prospects as positive influences on the currency during a panel discussion titled 'Reimagining Trade and Global Supply Chains for a Resilient Future' at the China Conference: Southeast Asia 2025.
Abdul Rasheed addressed concerns regarding the forecast for the ringgit by the end of the year, amidst the uncertainty caused by the US trade war. He clarified that BNM does not set specific targets for the ringgit, but focuses on preventing excessive volatility that could affect business decisions.
In addition, he outlined three key areas crucial for enhancing ASEAN integration: advancing the ASEAN financial system, building a resilient supply chain, and strengthening climate resilience. He pointed out that ASEAN is highly vulnerable to climate change, contributing to over 50 percent of global economic losses from disasters.
Abdul Rasheed emphasized the importance of mobilising financing for climate adaptation and decarbonisation efforts, noting a significant annual funding gap of about US$100 billion. He mentioned the growth of the ASEAN+3 Green Bond market and the ASEAN Catalytic Green Finance Facility's contributions to climate-supporting infrastructure.
He also highlighted the necessity for ASEAN to invest in infrastructure capable of withstanding climate shocks, citing potential economic losses from floods. Furthermore, he stressed the urgent need for a transition to clean energy, with a target of 50 percent renewable energy capacity by 2040, and the importance of the ASEAN Power Grid project in securing a low-carbon future.
Abdul Rasheed concluded by stating that regional central banks, including BNM, are collaborating on initiatives such as the ASEAN taxonomy for Sustainable Finance to further these goals.