Malaysia CBank’s Zeti: Must Avoid Overreaction To Rising Infl

BASEL (MNI) – Growth in emerging markets is approaching more
sustainable levels and overreaction to inflationary trends must be
avoided, Central Bank of Malaysia Governor Akhtar Aziz Zeti told
journalists on the sidelines of the BIS Global economy meeting.

Zeti warned that “there should not be an overreaction to the rising
inflationary trends.”

“Many of us have already raised rates and we don’t want an
overreaction that produces an over-adjustment,” she said. “Now most of
us are approaching a more sustainable pace of growth.”

As for the developed world, “what we have seen is that there has
been some slowing and the issue before us is whether that slowing is
temporary,” Zeti said.

Right now “it looks like it’s temporary and that growth momentum
will resume in the second half of the year”, but Western authorities
will “have to wait and make that assessment of whether the slowing of
growth is transitory or of a more fundamental nature,” Zeti said.

–Frankfurt bureau tel.: +49-69-720142. Email: jtreeck@marketnews.com

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