KUALA LUMPUR : The 24 per cent tariff rate imposed by the United States on Malaysian exports could affect growth although policies already in place will help to mitigate the impact, Malaysia’s central bank governor told Bloomberg Television on Wednesday.
Malaysian exports could be impacted by the tariffs, but the economy is diversified with the service sector accounting for 60 per cent of GDP, Bank Negara governor Abdul Rasheed Ghaffour said in an interview.
Malaysia’s economy grew 5.1 per cent in 2024 driven by strong domestic demand, record approved investments, and robust exports. The government has forecast growth of 4.5 per cent to 5.5 per cent this year, but is reviewing that in light of the U.S. tariffs.
Abdul Rasheed said the central bank was not in a rush to change its own forecast as the situation was fluid. He said it was important for the government to commit to structural reforms to strengthen the economy and provide support for the ringgit. The Malaysian ringgit fell to its lowest level against the dollar in two months on Wednesday, with emerging market currencies under pressure since the tariffs announcement.
Abdul Rasheed said the central bank expected continued ringgit volatility, and was ready to curb any excessive fluctuations. “Any currency intervention is done judiciously to ensure an orderly market,” he said. Bank Negara Malaysia has held its key interest rate unchanged at 3.00 per cent since May 2023.
