KUALA LUMPUR (Reuters) -Malaysia will need to mark down its growth forecast of 4.5% to 5.5% for the year due to trade and tariff uncertainties, its central bank governor said.
The Southeast Asian country is, however, in no rush to revise the forecast and will see how the global trade situation plays out, Bank Negara Malaysia Governor Abdul Rasheed Ghaffour said at an International Monetary Fund event in Washington on Wednesday.
Malaysia faces a 24% tariff rate in July for its goods exported to the U.S., unless an agreement is struck between the two countries.
Malaysia’s trade minister and second finance minister are currently in the United States for talks with the U.S. Trade Representative and other officials.
Abdul Rasheed said Malaysia was approaching the current global economic situation from a position of strength, given better-than-expected growth of 5.1% last year, strong domestic demand, increased investment activities, and a recovery in exports.
Malaysia’s key interest rate level of 3% was supportive of growth and reflected the central bank’s outlook for inflation, Abdul Rasheed added.
“We do not want monetary policy to exacerbate the uncertainty… More importantly is to stick to the mandate in terms of achieving price stability that can be conducive for sustainable economic growth,” he said.
(Reporting by Danial Azhar; Editing by Martin Petty)
