SINGAPORE (Jan 8): If it has been said once, it has been said a thousand times in the past three years — “The ringgit is undervalued based on its fundamentals”. But in 2017, the ringgit’s fundamentals could not be ignored any longer.

Last year saw Malaysia’s GDP grow 6.2% y-o-y in the third quarter, shattering all expectations. With the economy expanding at its fastest pace in nearly two years, full-year GDP growth is now expected to hit 5.8% y-o-y, up from 4.2% y-o-y in 2016.

Couple this with improving crude oil prices, stable inflation, an anticipated interest rate hike, a strong trade surplus and a narrowing budget deficit, and you have a strong case for the recovery of the ringgit.

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