The Malaysian ringgit has depreciated sharply against the US Dollar and the Singapore Dollar over the past few months.
A. Give your analysis on the depreciation of the Ringgit based on the balance of payments data of Q4 2021 and Q1 2022.
B. Explain the implications on Malaysia's foreign trade.
Notes:
1. You can refer to Malaysia's balance of payments data from the www.bnm.gov.my page in the "Rates and Statistics" column under the heading "Monthly Highlights and Statistcis", especially table 3.6.
2. The answer is to use your knowledge of money inflows and outflows, and the demand and supply of foreign currency in determining the exchange rate.