BNM, US Treasury To Continue Close Consultations On Macroeconomic, FX Matters

KUALA LUMPUR, Oct 28 (Bernama) -- Bank Negara Malaysia (BNM) and the United States (US) Department of the Treasury have agreed to continue close consultations on macroeconomic and foreign exchange (FX) matters.

BNM said the US and Malaysia reaffirmed their commitment under the International Monetary Fund (IMF) Articles of Agreement to avoid manipulating exchange rates or the international monetary system for unfair competitive advantage or to prevent effective balance of payments adjustment.

They also agreed that any macroprudential or capital flow measures will not be used to target exchange rates for competitive purposes. Additionally, both nations pledged that other government investment vehicles such as pension funds invest abroad for risk-adjusted return and diversification purposes, and not to target the exchange rate for competitive purposes.

“Both countries concurred that FX market intervention should only be used to address excessive volatility or disorderly movements, whether due to sharp depreciation or appreciation,” BNM said in a statement.

The central bank also underscored the importance of transparent exchange rate policies, committing to disclose net FX purchases or sales on an aggregated basis over 12 months, published every end-March and end-September.

It will also continue to release FX reserves and forward position data monthly, in line with the IMF’s Data Template on International Reserves and Foreign Currency Liquidity.

Additionally, BNM commits to share aggregated six-month FX transaction data with the US Treasury on a confidential, bilateral basis, with a three-month lag.

-- BERNAMA