Central Banks Must Evolve Into Architects Of Resilience, Says BNM Governor

KUALA LUMPUR, April 1 (Bernama) -- Central banks must evolve into architects of resilience in a changing global landscape, rather than merely remain stewards of stability, important as that role remains, according to Bank Negara Malaysia (BNM) Governor Datuk Seri Abdul Rasheed Ghaffour.

He pointed out that while stability keeps the house standing, resilience ensures it can be lived in safely, adaptively, and for the long term.

Abdul Rasheed said central banking evolved, reshaped by crises, failures and the hard-won learning accumulated over generations, including many episodes of economic history such as the Great Depression, the stagflation of the 1970s, the Asian Financial Crisis of 1997/1998, and the Global Financial Crisis of 2008. 

For Malaysia, he said, BNM’s duty to safeguard monetary and financial stability exists precisely to provide a conducive environment for the sustainable growth of the economy. 

“For Malaysia, this evolution has been deeply lived. The Asian Financial Crisis in the late 90s was formative. Decisions then were guided by a clear purpose: to safeguard our financial system, protect households and businesses, and lay the foundation for a recovery that many doubted was possible. 

“That experience instilled and shaped BNM’s institutional character in lasting ways, a strength that carried through as we navigated the pandemic years and beyond,” said Abdul Rasheed in his keynote address at the Central Banking Meetings on Tuesday.

The BNM governor said the experience navigating the Asian Financial Crisis gave the central bank the conviction that resilience is not accidental; it is built holistically through strengthening the ecosystem, disciplined policy, clear institutional roles, robust frameworks, and the willingness to make difficult decisions in difficult times.

He said that to build the resilience demanded of central banks, these institutions must evaluate and navigate the shifting global economic landscape, manage the rapid transformation of emerging technologies and demographic changes, and withstand public scrutiny of their actions, which can occur in real time or within hours.

“Decisions by central banks are dissected in real time, translated into narratives that reach millions within hours. Every word in a policy statement is shifted for hidden meaning,” he said. 

Abdul Rasheed said that central banks, including BNM, are adapting to this changing landscape by transforming their focus, strengthening resilience through collective action, communicating to earn trust and building institutional capacity through technology and human capital.

He said the role of central banks has expanded beyond their core mandates, requiring a more integrated approach that takes into account broader economic linkages such as fiscal conditions, labour markets and financial inclusion.

At the same time, Abdul Rasheed said policy coherence across public and private sectors would advance structural reform and social protection measures.

“Besides that, communications must be clear, accessible and honest, designed to strengthen genuine public understanding of what we do and why.

“Central banks are leveraging technology, including artificial intelligence, while continuing to develop talent and expertise that could blend policy expertise with practical industry insight,” he added.

-- BERNAMA