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Why did the central bank peg to the usd in september

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Reference no: EM133070204

In September 1997 Malaysian central bank decided to cap (or peg) the value of the RM against the USD at 3.80 RM to the USD. In June 1998 the central bank announced that they were ceasing to peg the RM against USD; the exchange rate would revert to floating.

Required:

Why did the central bank peg to the USD in September 1997? Explain.

Reference no: EM133070204

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