Bank Negara Malaysia said the country’s economy looks well on track to achieving the upper end of the central bank’s 4.5-4.8 per cent annual growth projection for 2017. The Central Bank’s Governor Datuk Seri Muhammad Ibrahim said that export numbers for the first three months of the year have been good. Exports in February, in particular, surged by 26.5 per cent, the fastest pace since 2010. “If that trend continues, we might see growth gravitate to the higher end of the range,” he said at a media briefing in Labuan, held to announce the Labuan Financial Services Authority 2016 Annual Report launch.
If there are no unforeseen conditions which may cause the economy or sentiments to be adverse, especially in terms of geopolitical risks, that will also strengthen the upper end growth projection for the economy.
On the interest rate policy, Muhammad said the next monetary policy meeting, which will be held on May 12, will address risks to growth, inflation and financial imbalances. “At the end of the day, it must be at a level that will promote economic growth… that is very important for us to look at,” Muhammad said. Although inflationary pressures have risen over the past two months, he said the level of the Consumer Price Index (CPI) will go down. But the central bank will still adhere to the 3-4 per cent inflation projection for 2017, until an assessment at a later date.
On the stronger performance of the ringgit, the central bank chief said the improved levels reflect the measures undertaken since December. “We expect the demand and supply of the ringgit to be more balanced than before. It will reflect the strong fundamentals that we have now,” he added.