Malaysia’s c. bank urges for structural reforms

The Bank Negara Malaysia (BNM) is calling for accelerated structural reforms to ensure sustainable economic strength and support for the ringgit currency, according to Reuters on Wednesday.

The government plans to transition from blanket subsidies to targeted assistance for low-income groups, potentially leading to higher fuel costs.

BNM Governor Abdul Rasheed Ghaffour emphasised the need for key reforms to strengthen the economy amid positive macroeconomic prospects.

BNM maintained its 2024 growth forecast at 4 to 5 per cent, with exports expected to rise by five per cent, the report added.

The country’s inflation is projected between 2 to 3.5 per cent, with potential risks from subsidy adjustments and currency depreciation.

The ringgit has rebounded after reaching a 26-year low last month, but it remains approximately 3.2% weaker against the U.S. dollar year-to-date.

Abdul Rasheed highlighted efforts to attract foreign investment and stabilise the currency.

The structural reforms in the labour market and investments in high-value industries are seen as long-term support for the ringgit.