The sharp plunge in the Argentine Peso (ARS) following the footsteps of the Turkish Lira (TRY) has raised concerns again about the risk of a contagion effect among emerging economies' currencies, RHB Research Institute Sdn Bhd Chief Asean Economist Peck Boon Soon said in a research note.

"Currencies with the same weak economic fundamentals, like the Brazil real (BRL), Indonesian rupiah (IDR) and Philippine peso (PHP), also face selling pressure, albeit to a lesser degree.

"Despite some similarity and selling pressure, we believe the contagion effect would unlikely spread to this part of the region," he said.

According to him, two major Asean countries that also face a similar problem of twin deficits are Indonesia and the Philippines. However, Sunway University Business School Economics Professor Dr. Yeah Kim Leng said Malaysia is not overly exposed to the contagion in the currency market.

"Overall, Malaysia has sound economic fundamentals which have translated into steady growth, low unemployment and manageable inflation.

"Malaysia needs to reiterate its stand to foreign investors that its fiscal balance and current account position still remain intact," said Yeah.