"I think it's a very silly suggestion. We are not going to impose exit tax, period," Nor Mohamed Yakcop, Second Finance Minister, told reporters at a briefing in the country's administrative capital of Putrajaya.

Rumours that the ringgit, which has been pegged to the US dollar at a rate of 3.80 since the Asian financial crisis of 1997/1998, is to be revalued have been growing amid increasing pressure on the Chinese to revalue the yuan.

Interestingly, Malaysia successfully used the exit tax tactic to fend off short-term investors during the crisis as the currencies of neighbouring nations such as Thailand and Indonesia fell sharply.

Analysts have suggested the ringgit is about 10% to 15% undervalued compared with rival Asian currencies, although the Central bank governor Zeti Akhtar Aziz stated last week the ringgit is undervalued by less than 5%.

While most observes believe a revaluation of the ringgit will be pre-empted by Beijing's decision to revalue the Chinese currency, the Malaysian government has stressed that it has the freedom to act on the currency peg independently.

"Theoretically, we don't have to wait for anybody, but practically, whether we want to, it is based on that matrix of factors that we have to take into account, that any government will have take into account," Nor Mohamed said.