Consequently, the market perceived that the reversal of NR holdings will have negative bearing on the ringgit and market liquidity;Fifth, the gross misperception on the adequacy of the reserves. There is this perception that reserves of less than US$100bil is not sufficient to provide comfort to investors. The sizeable speculative activities and herd-behaviours that take place in the offshore market have considerable influence over offshore ringgit pricing. Consequently, the offshore market significantly misprices the ringgit. "On the other hand, onshore pricing is based on real demand and supply that reflects real economic activities," he said.

Source: The Star November 20, 2017 07:23 UTC