KUALA LUMPUR, Aug 26 — Tan Sri Zeti Akhtar Aziz, Malaysia’s central bank governor, comments on monetary policy and risks to inflation and growth.

On monetary policy direction:

“We have to assess the situation as we go along. We will look at domestic conditions, we will look at the risks to growth, the risks to inflation, we have to look at potential destabilizing financial imbalances.

‘‘All these will be monitored and assessed and our interest-rate policies will be based on these considerations.’’

On whether inflation or growth is bigger risk:

‘‘Both have their respective risks. Right now, our assessment is the Malaysian economy will remain on a steady growth path. And that’s important. It’s because we have a very diversified economy, when the external environment improves, we see the trade sector contributing significantly to growth. And at other times, we see that the private sector has strong investment activity and this also contributes to growth. Therefore we are seeing a steady economic growth taking place.

‘‘At the same time we are seeing risks to inflation, but in our assessment, these risks are likely to be temporary. This is a period of price adjustments and these price adjustments will lead to temporary increases in inflation, but we expect, by the year 2016, this inflation will trend towards our long-term average of about 3 per cent. So this is what the policy will be focused on, monitoring this and ensuring that it will trend towards its long-term average.’’

On whether key rate is appropriate:

‘‘The environment is very dynamic and therefore we will assess periodically from time to time prospective risks and interest-rate policy will be based on this assessments.’’

On Statutory Reserve Requirement ratio tool:

‘‘The SRR adjustment is only when we see fundamental change in liquidity in our financial system. Right now, we are managing the liquidity through open-market operations to ensure that liquidity is ample and to ensure that we also don’t have excess liquidity that will result in excess credit growth.

‘‘So we have an extensive policy toolkit and this is important for a country like Malaysia, which is now progressing into a greater maturity in our financial system. So we have these tools at our disposal, not only to rely on interest rates and the SRR, but also on prudential measures and other measures so that we can ensure stability in our system.’’

On using SRR versus key policy rate:

‘‘All that will be assessed very, very carefully.

‘‘The SRR will only change if our assessment is that these are fundamental shifts that may result in fundamental changes in liquidity conditions. If it’s temporary, then it will not. We will rely on open-market operations.’’

On liquidity conditions:

‘‘If we see excess liquidity, which from time to time we do see such excess liquidity, we can absorb it through money-market operations. So we rely more on what we called market-based instruments.’’ — Bloomberg