ORDERLY FUNCTIONING OF FOREIGN EXCHANGE MARKETS IMPORTANT

KUALA LUMPUR, Feb 21 (Bernama) -- An orderly functioning of foreign exchange
markets is important, Malaysia's central bank governor Dr Zeti Akhtar Aziz said
Monday.

She said that despite the volatile capital flows, the Malaysian market was
orderly because there was a two-way flow.

"We have both inflow and outflow, and while it (the ringgit) has gradually
strengthened, it has done so in a very orderly manner," she said when asked
about the strengthening of ringgit after delivering a keynote address at the
launch of Bloomberg's Enhanced Islamic Finance Platform here.

The Bank Negara Malaysia (BNM) governor said a firmer ringgit reflected the
country's economic fundamentals and "right now, Malaysia's economic fundamentals
are strong".

At 9.01am Monday, the ringgit traded at 3.0310/0335 against the US dollar
compared with 3.0335/0355 at Friday's close.

Meanwhile, when asked about a possible increase in the Statutory Reserve
Requirement (SRR), Dr Zeti said: "This is something we will make an assessment.

"SRR is a monetary policy instrument to manage liquidity and if the need
arises this is one of the instruments at our disposal amongst many others," she
said.

Dr Zeti also said Malaysia was among three countries together with Hong Kong
and Australia whose private debt securities markets were larger than their
government debt securities markets.

"Malaysia has a significant and growing corporate debt securities market
comprising conventional and sukuk," she said.