KUALA LUMPUR/BANGKOK (Feb 7): Malaysia’s crackdown on currency speculators has come at a cost. While it successfully reduced ringgit volatility, it is threatening to discourage overseas investors. Global funds cut holdings of Malaysian debt by a combined 25.2 billion ringgit ($5.7 billion) in November and December, the biggest two-month outflow since 2008, central bank data show. The difference between onshore and forward prices for the ringgit jumped to a record in November, spurring the central bank to crack down on NDF trading. Traders remain wary even after central bank Governor Muhammad Ibrahim allowed for greater hedging flexibility in the onshore currency market in an attempt to discourage the use of NDFs.

Source: The Edge Markets February 06, 2017 23:03 UTC