Tuesday, 8 May 2012

Minimum wage no impact on inflation, says Zeti

KUALA LUMPUR (May 8): The implementation of minimum wage would not contribute to inflation as it represents a small portion of production cost, said Bank Negara Malaysia governor Tan Sri Dr Zeti Akhtar Aziz.

"We have already priced in the prospect of minimum wage. We believe that it represents a small part of production cost and therefore would not contribute to higher prices - particularly in the period of moderating prices," she said on Tuesday on the sidelines of the Asian-Pacific Association of Banking Institutes conference.

She added the central bank's inflation forecast still remains at 2-3%.

On the impact of deleveraging Europe on Asian economies, Zeti said it would only be in a "limited extent".

"There is ample liquidity in our region and our financial sector can step in to provide liquidity," she said.

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