Malaysian Prime Minister Najib Razak said on Thursday he would not peg the ringgit to the US dollar or implement capital controls as he sought to calm fears about the sliding currency and capital flight from Southeast Asia's third-largest economy.
Najib, who has come under severe criticism after being embroiled in a scandal over indebted state fund 1Malaysia Development Berhad (1MDB), is trying to reassert his leadership over his government and a stumbling economy.
"The flexibility of our exchange rate is important to absorb global adjustments and volatility," Najib said in a statement. The ringgit, Asia's worst performer this year with losses exceeding 17 percent against the dollar, was steady on Thursday after the comments and found some respite as China's yuan rallied. With debts of over $11 billion, 1MDB is being investigated for allegations of graft and financial mismanagement. Najib sits as the chair of its advisory board.