KUALA LUMPUR, May 8 (Bernama) -- Bank Negara Malaysia''s (BNM) inflation
forecast of between two and three per cent still remains despite the
introduction of the minimum wage, says its Governor Tan Sri Dr Zeti Akhtar Aziz.
She said the minimum wage was positive, as it would contribute to an
increase in consumption as the group it catered to had a high propensity to
consume.
"We have already priced in the prospect of the minimum wage. As you know,
more than 100 countries in the world have already implemented it," she told
reporters on the sidelines of the Asian-Pacific Association of Banking
Institutes Conference, here today.
Zeti said the central bank believed that the minimum wage represented a
small part of production cost and would not contribute to higher prices
particularly when the country was in a period of moderating prices.
Asked on the impact of European banks deleveraging in Asia, she said most
countries in Asia would be affected but to a "limited extent" because there was
ample liquidity in the region.
"Our financial sector can step in to provide the liquidity," she said.
Meanwhile, Zeti was of the view that the automotive industry in Malaysia was
a highly competitive industry and operating in a market that was already very
saturated.
"So it''s all about becoming more competitive by improving productivity,
innovation, greater efficiency, reducing cost, new model and going to
international market," she said.
She said this when asked whether BNM would allow the implementation of any
new guidelines in stages so as to allow a soft landing for both the players and
consumers.
-- BERNAMA
MI MI NN