Ultimately, regulations exist to promote a safe, efficient and sound financial system that is competitive and where consumers’ interest are protected. Regulatory regimes promote the foundation of trust and confidence that is crucial in any financial system. If people do not trust the system, financial intermediation cannot take place in any shape or form. As the modalities for financial intermediation and payments are transformed by technology, regulation should play an 6/7  BIS central bankers' speeches  active role in creating a similar environment of trust to ensure overall financial stability. The boundaries of regulation will evolve to provide the freedom for participants in the Malaysian financial system to innovate and adopt technology to exploit efficiencies and create new and better solutions. Solutions that not only deliver better experience for consumers, but that better align the responsibilities that we all carry as responsible citizens, to lift people out of poverty, provide our fellow Malaysians a decent living standard, eliminate discrimination and protect our environment. Regulation is never intended to make market players ‘boring'. If they feel that way, it only tells us one thing – that they have become too complacent in their comfort zone and should undertake a reality check. Malaysia’s financial institutions especially must not lay idle as innovations will be relentless in accessing and penetrating the traditional market long enjoyed by the banks. Using the disguise of being tied by regulations is not a valid excuse.

Despite almost 10 years of ultra-easy monetary policy, and despite stronger growth and better labour market conditions, some countries are still devoid of inflation. This latest enigma of “missing inflation” has further spurred the search for the next best thing after inflation targeting. It has become increasingly clear that the nature of problems facing policymakers and the underlying heuristics are becoming very complex. What we thought we knew about inflation dynamics has been inadequate and has not factored in many other relevant factors. Inflation dynamics have evolved with structural factors such as the global value chain, demographics, technological advancements and the digitalisation of the economy. In such a dynamic environment, it is only logical to think that one must be pragmatic, flexible and agile. This is why we focused on inflation anchoring without being tied to a single numerical target. To effectively do this, our monetary policy framework will take into account a broader consideration of factors that could affect the domestic economy and financial system. It also allowed us some flexibility to monitor how our monetary policy actions could interact with key issues facing the public, such as distributional implications, cost of living, access to financing and financial inclusion. As we understand these interactions better, our responses, including monetary policy decisions, can be more nuanced and effective. Malaysia’s policy approach has remained relevant Inflation anchoring was not the only thing we did differently. In fact, Malaysia has never shied 4/7  BIS central bankers' speeches  away from taking the path less travelled.