Friday, Feb 17, 2012
("Malaysia Central Bank Responds To Fatwa Against Forex Trading," at 1017 GMT on Thursday, misstated that the National Fatwa Council opposes all forex trading, rather than just electronic forex trading by individuals, in the headline and first paragraph. The error originated with Bernama. The correct version follows.)
KUALA LUMPUR (Dow Jones)--Malaysia's central bank reiterated Thursday that foreign currency trading is only allowed through licensed institutions, a day after the country's highest Islamic body said spot forex trading by individuals using electronic platforms involves speculation, which is against Islamic law.
"A study by the committee found that such trading involves currency speculation, which contradicts Islamic law. For that reason, the National Fatwa Council has decided that it is haram," or forbidden, "for Muslims to be engaged in such trading," council Chairman Abdul Shukor Husin was quoted as saying Wednesday by the state news agency, Bernama.
On Thursday, the central bank sent out a statement that forex trading "is only allowed with licensed commercial banks, Islamic banks, investment banks and international Islamic banks," and with licensed money changers.
The central bank added that financial products that comply with Islamic religious law, including forex-related transactions by licensed Islamic financial institutions, "are approved by the Shariah Committee of the respective financial institutions with endorsement from the Shariah Advisory Council of Bank Negara Malaysia."
One local currency trader said neither statement is likely to impact forex trading in the country, as they don't represent any change to existing regulations.
-By Ankur Relia; Dow Jones Newswires; 603-2026-1233; ankur.relia@dowjones.com
(END) Dow Jones Newswires
17-02-12 0546GMT
