KUALA LUMPUR: Malaysia's finance minister is to hold talks today on whether to re-peg the ringgit, state news agency said yesterday, quoting a top finance ministry official.

Second Finance Minister Nor Mohamed Yakcop said Datuk Seri Najib Razak, who was appointed Finance Minister last week, would discuss the issue of the peg after former prime minister Minister Mahathir Mohamad called for the exchange rate to be fixed again.

'Various issues would be presented at the briefing including the economic situation, finance and the challenges faced in Malaysia and in the international arena,' he told reporters in Penang, according to state news agency Bernama.

Tan Sri Nor Mohamed said the briefing would also discuss whether the ringgit would be re-pegged to cushion the impact of the weakening US dollar against other currencies, Bernama reported.

It was Tun Dr Mahathir who defied the International Monetary Fund in response to the Asian financial crisis of 1997 and 1998 when he imposed capital controls and pegged the currency at 3.8 to the US dollar.

The peg was scrapped in July 2005 and the ringgit is currently in a managed float against a basket of currencies and it last traded at 3.459 to the greenback.

'We need to fix the value of the ringgit and I believe the government should do away with managed float because it will result in a loss,' Bernama quoted the former leader as saying.

Dr Mahathir said that a 10 per cent revaluation of the ringgit would help ordinary people by cutting inflation which in July hit a near-27 year high of 8.5 per cent.

If indeed the ringgit gets revalued higher, Singapore's imports from Malaysia may become more expensive in the short term.

In the longer term, prices will depend on how the US dollar fares against the Singapore dollar.