In this concluding part, we look at the country’s experience in pegging a currency (de facto and de jure) and at managed floats. Did the currency peg save Malaysia? Bank Negara announced the adoption of a managed float regime for the ringgit in 2005, as a replacement for the peg. To make things worse, the ringgit is a non-internationalised currency, meaning that speculative players cannot obtain and play with it offshore. An interesting finding was that under pegged regimes, monetary growth was tiny and quite stable, leading to GDP growth that was quite stable.

Source: The Edge Markets July 07, 2022 15:34 UTC