KUALA LUMPUR(Nov 24): The managed float mechanism on RON95 petrol and diesel will not have inflationary consequences, said Bank Negara Malaysia Governor Tan Sri Dr Zeti Akhtar Aziz.

“(Oil) prices are now softening and therefore this is good for consumers because they will benefit from the lower prices. This also helps the government in terms of the burden of subsidies in the budget. Therefore, this (managed float mechanism) is a positive development that will not have inflationary consequences because (oil) prices are softening,” she told reporters after opening SWIFT’s Kuala Lumpur Corporate Services Centre today.

On whether Bank Negara will change its views on monetary policy in light of the mechanism, the governor said it will not change the central bank's policy outlook.

“We need to look at the overall effect of the risks to inflation,and we also need to look at any implications on other developments on growth, these are the two factors we will look at over the medium term, so right now it doesn’t change our outlook [on monetary policy],” said Zeti.