Ringgit is still weak, when compared to years ago. Ringgit is strong, when we look at Bloomberg’s image on the side, showing the performance of a number of currencies within 2017, as at a few days ago. Anyway, regardless of our own predictions or thoughts, the World Bank says that Malaysia has some currency risks. This is the full article in TheEdgeMarkets here. World Bank sees currency risk in Malaysia. Briefly, the World Bank says Malaysia is more exposed to exchange rate risk than other developing countries as global financial conditions tighten. It added that foreign exchange reserves appear adequate even though there is a sizeable external debt. It raised the growth forecasts for Malaysia for 2017 and 2018 versus its earlier estimations in April 2017. The reason? Improving global environment and strong domestic demand.
What World Bank is worried about include budget deficits which it considers as remaining high or are expected to rise in most countries over 2017 to 2019. This is made worst by some uncertainty with economic policies in some advanced economies (Yes, I think we know which one too. I think it’s one which is changing their capable chairperson in the near future) as well as the escalation of geopolitical tensions. (Yea, I think we know which one is causing all these frictions) Last but not least, Sudhir Shetty, chief economist for the World Bank’s East Asia and Pacific region said in an an interview with Bloomberg TV, “What policy makers need to do is not be lulled by the fact that it’s been a good period for the global economy.” He added, “Officials need to look for ways to mitigate some of the vulnerabilities that have built up even as the region is generally well-prepared.” Full article in TheEdge Markets here.
According to MEF executive director Datuk Shamsuddin Bardan, there will be slightly more retrenchments in 2017 versus 2016. I personally think the risk can be ascertained better by looking at the job numbers. More jobs means lower risks while more retrenchments certainly mean a higher risk because when people are out of job, they have no salary to pay for their living expenses. As at today, perhaps the number of jobs are still aplenty. Looking at JobStreet.com.my, total number of posted positions are at 27,829 as at today. Not too bad even if the number of jobs usually trend downwards towards the end of the year and will restart to be crazy after the bonus period for most employees. Happy working hard.
written on 9 Oct 2017
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