Mahathir's Surprise Return to Test Ringgit Traders' Resolve
- Ringgit set to test support at 4 per dollar: Bank of Singapore
- Mahathir to focus on economy, says no cause for ringgit drop
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The surprise comeback of Malaysian leader Mahathir Mohamad, who once imposed capital controls, is likely to halt a rally in Asia’s best-performing currency amid concerns pro-growth reforms will give way to populist campaign promises.
The ringgit may initially slide to the psychological level of 4 per dollar, although the size of its decline will depend on the level of clarity about the new policies, according to Bank of Singapore. ING Groep NV cut its year-end forecast to 4.05 from 3.84 after the vote, citing political uncertainty.