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Governor Tan Sri Dr Zeti Akhtar Aziz said although the country is experiencing a significant contraction in the external sector, domestic demand continues to show growth.
She said improvement would depend on whether global measures, which have been announced and implemented, will have the desired effect and bring about stability in the later six months of the year.
Zeti said domestic demand was supported by the recent implementation of the two stimulus packages worth a total of RM67 billion and the easing of monetary policy.
"If improvement does happen, we will be giving you a revised forecast in the middle of this year," she told reporters after launching the SME Credit Bureau's corporate identity in Kuala Lumpur.
Bank Negara has projected gross domestic product of between -1 per cent and 1 per cent for 2009.
When asked on interest rates, Zeti said it has been front-loaded and the central bank will be monitoring the situation closely.
"The issue is not about the cost of financing. Our average interest rates are already at their historical lows.
"We believe it is more about the access to financing. That is why we are putting our focus on the access to financing," she said.
The Overnight Policy Rate currently stands at 2 per cent.
On the proposal to internationalise the ringgit, Zeti said it needs to be done at the most suitable time and not under unstable financial and economic conditions like now. "One of the pre-conditions to internationalise the ringgit is a robust and vibrant foreign exchange market onshore. We have yet to achieve this," she said.
Source from: smeblog.nst.com.my
