Zeti says ringgit UNDERVALUED but monetary policy to remain 'accomodative'

KUALA LUMPUR - Bank Negara Malaysia governor Tan Sri Dr Zeti Akhtar Aziz believes the ringgit is currently undervalued, and expects that over time it will reflect the country’s underlying fundamentals.

“The ringgit in our assessment is undervalued at this point of time and over time we expect it to reflect our underlying fundamentals which at this point manifests itself in steady growth in the region of 5%,” she said on Tuesday.

Zeti added the current monetary policy remains accommodative. Bank Negara, she said, will continue to evaluate and monitor the risks to inflation and to growth.

On the inflation outlook, she does not expect it to dip into negative territory.

“While inflation is slightly lower than earlier expected, we don’t expect it to trend in negative territory as what we have seen in certain countries that are experiencing deflation,” Zeti said.

She was speaking to reporters after the launch of the Maybank Islamic Shariah Centre of Excellence at the main campus of The Global University of Islamic Finance.

At 2.38pm, the ringgit was trading at 3.6345 against the US dollar from the previous close of 3.6372. - ANN