Posted by ks55 > 1 hour ago | Report Abuse

Ringgit appreciates too much too fast is not good for Malaysian business.The effects could be similar to 1997/98 when ringgit nose-dive.

Consider importer and exporter businesses. How to decide on pricing when come to negotiation? Hedging is one effect way, but that involve cost.

You export your products (say to US) in USD, then your dollar worth much less in terms of ringgit, cost of production may be more than your export value. You make a loss.

You import crude oil from Saudi in US dollar earlier, your inventory all are much lower than replacement cost, so refinery has to write off big money to reflect on actual value. Refinery lose money.

Only trading company that import goods from China (especially EV) will make more money, as ringgit appreciates more than RMB. So MR DIY is going to make more profit.