KUALA LUMPUR, May 12 — Contrary to claims that the economy would crash if Pakatan Harapan (PH) takes Putrajaya, Bank Negara Malaysia (BNM) governor Tan Sri Muhammad Ibrahim today said the country’s economy is resilient and strong.
He said short term volatility was expected from the 14th general election, but that setback, he pointed, would not pose a long term effect on the economy.
“The Monetary Policy Committee of BNM has reaffirmed that the outlook of the Malaysian economy remains strong, healthy and robust.
“Our experience tells us that we must be careful not to over-react to market noises, especially when it is caused by factors which are temporary in nature” he said at the Asian Institute of Chartered Bankers graduation ceremony press conference.
Moving ahead, Muhammad said BNM will continue to ensure orderly conditions in the onshore financial markets.
In the medium and long term, he said the ringgit will reflect Malaysia’s strong economic fundamentals.
“Our strength can be seen from the current account surplus, a strong reserves position, low level of external indebtedness and strong capital buffers in the banking system,” he said.
Asian Institute of Chartered Bankers (AICB) chairman Tan Sri Azman Hashim also said the market sentiment on Monday could experience some “nervousness” but would quickly stabilise under the leadership of Tun Dr Mahathir Mohamad.
“If Prime Minister Tun Dr Mahathir is able to show a Cabinet before that, I don’t think the effect would be that significant,” he said.
Azman said he was confident in Dr Mahathir’s leadership in gaining investors’ confidence back.
“Dr Mahathir has said finance and the economy are his top two priorities, so I am sure he will come up with a mechanism to gain back their confidence,” he said, referring to market investors.
Dr Mahathir is expected to announce a 10-man Cabinet today.