Bank Negara Malaysia governor Tan Sri Dr Zeti Akhtar Aziz said the challenge for policymakers in 2016 will be immense in view of the simultaneous `multiple’ developments affecting the global economy. The highly open Asian economies are also not immune to these developments but most of them, including Malaysia, embarked on structural adjustments and financial reforms which have enabled them to withstand the global financial crisis of 2008 and the aftermath. She was speaking at a policy dialogue on the US interest rate normalisation and its impact on financial stability at the Asian Financial Forum.
“Financial institutions have restructured, rationalised, recapitalised and bond markets have developed while regulatory and supervisory regimes have been significantly strengthened.” She expects the current volatility in capital flows to be temporary.
“Funds will return to growth centres and Asia will most certainly continue to be an important growth centre in the global economy.”