“The ringgit is actually undervalued due to the significant risk premium built into it. A lot has to do with the perceived risk of political instability following the 1MDB issues. However, he said the political risk premium accorded to the ringgit should narrow over time as the political landscape becomes clearer. “The fear of political instability, I think, is overblown. The headwinds should dissipate and the risk premium would gradually narrow and that should allow the ringgit to strengthen to the 3.80 level against the US dollar, perhaps towards end-2017,” he said.

Source: The Edge Markets November 09, 2016 00:42 UTC