Abdullah took over both posts on October 31 from Mahathir Mohamad, who was responsible for pegging the ringgit at 3.8 to the dollar amidst the Asian economic crisis in 1997/98.

"I find that our exchange rate mechanism is very beneficial to our economy," Abdullah told a news conference after paying his first visit to the central bank for a meeting with top officials.

The premier said the peg, which Mahathir defended staunchly against international suggestions that the ringgit be refloated, had not been discussed and he presented an upbeat assessment of the country's economic performance.

"I'm thankful for our economic situation is improving at this moment in time. I hope we will see an even better performance in the near future.

"Our international reserves are currently quite high and well-managed," he said.

The central bank's foreign exchange reserves were 166.9 billion ringgit (44 billion dollars) as of November 15, according to official figures.

Azrul Azwar, an economist with MIDF-SISMA Securities agreed with the positive outlook, saying that he had upgraded his economic growth forecast for this year and the next.

Gross Domestic Product (GDP) for 2003 should be 4.8 percent, up from his original estimate of 4.5 percent and 2004 should see 5.0-5.5 percent growth, up from a prediction of 4.9 percent, he said.