BNM's New Governor Warns About Malaysia's Inflation!

<p>&nbsp;The new governor of Bank Negara Malaysia (BNM), Datuk Abdul Rasheed Ghaffour reminded Malaysia to remain vigilant against core inflation which is still higher than usual.</p><p><br /></p><p>He was just appointed on 1 July 2023 to replace Tan Sri Nor Shamsiah Mohd Yunus who completed his five-year term on 30 June 2023.</p><p><br /></p><p>He added that high inflation affects people's lives, especially the low-income group, in addition to harming the economy significantly.</p><p><br /></p><p>In its latest forecast, BNM projected both headline and core inflation to decline in the second half of the year.</p><p><br /></p><p>However, despite expected moderation, core inflation remains elevated relative to the long-term average due to persistent demand and cost factors.</p><p><br /></p><p><br /></p><p>Commenting on the Ringgit's depreciating value, Datuk Abdul Rasheed said it does not give an accurate picture of the fundamentals of the country's economy, as the economy has become very resilient when going through the pandemic.</p><p><br /></p><p>He said, ringgit trading has been affected by external developments and sentiments, especially the strengthening of the US dollar and China's slow recovery.</p><p><br /></p><p>In addition, because Malaysia's interest rate is one of the lowest in Asia, it also affects the value of the ringgit currency.</p><p><br /></p><p>Even so, he said the central bank is committed to ensuring orderly market conditions and will intervene to prevent excessive ringgit fluctuations.</p><p><br /></p><p>Meanwhile, governor Abdul Rasheed said the central bank's decision to maintain the overnight policy rate (OPR) at 3.00% is consistent with BNM's mandate to maintain price stability for sustainable growth.</p>