BIS central bankers’ speeches  3  sustained basis, that would pose a risk to inflation and, thus, would have important implications for monetary policy. With respect to the inflation outlook, I think there are four important questions that deserve attention. 1. How much slack is there in the economy? In other words, how fast can the economy grow for how long until the economy is close to full employment? 2. Are there speed-limit effects on inflation? In other words, could inflation rise because the rate of economic growth was unusually high, even though plenty of slack remained in the economy? 3. Given the emergence of such economies as China and India, can commodity price pressures be safely ignored as temporary “noise” in terms of the long-term inflation outlook or are these pressures likely to prove persistent? If commodity price pressures persisted, this could undercut one rationale for focusing on core measures of inflation – the argument that core measures are better predictors of future headline inflation than today’s headline rate. 4. What can the Federal Reserve do to ensure that inflation expectations stay wellanchored? With respect to the first question, the economy retains a very large amount of slack by virtually all measures. For example, last month the industrial capacity utilization rate was 76.1 percent. This compares with a long-term average of 80.9 percent (Chart 21).
Zamani Abdul Ghani: Malaysia – seizing the opportunity to evolve Opening remarks by Mr Zamani Abdul Ghani, Deputy Governor of the Central Bank of Malaysia, at the Seminar on Financing for Overseas Project, Kuala Lumpur, 14 January 2010. *  *  *  I am pleased to be invited today to officiate this Seminar on Financing for Overseas Project. On behalf of Bank Negara Malaysia, I wish to thank and congratulate the EXIM Bank, the ICD and the CIDB for their efforts in organizing this important and invaluable Seminar. The continuous collaboration among Malaysian private and public related organizations with the IDB and its related organizations demonstrate the solidarity of the Muslim Ummah and the community at large towards achieving a strong and sustainable economic development. This also reflects the growing importance of cross border trade and investment among the OIC member countries. We, at Bank Negara Malaysia, are pleased to note that over 200 participants from more than 100 companies in Malaysia are participating in this Seminar. Today’s Seminar which brings together participants in the related industries, not only provide information on the business opportunities abroad, but also serves as an excellent platform to establish new networking links as well as sharing of innovative ideas and invaluable experiences. Malaysia has always accorded and will continue to accord a high priority on enhancing collaboration with the OIC member countries towards fostering intra-OIC trade and investment. Realizing the large business opportunities in the OIC countries, Malaysia entered into an MoU with the IDB in 2004.