Malaysia c.bank keeps rates on hold as inflation, growth cool
* Interest rate maintained at 3%, in accordance with predictions
* Central Bank: maintaining policy position aligned with inflation, economic expansion prospects
* Majority of economists anticipate no alteration in rates throughout the year * The consensus among economists is that rates will remain unchanged in the current year * The prevailing view among economists is that there will be no rate adjustment for the rest of the year * Economic experts predict that rates will remain stable for the entirety of this year
Malaysia's central bank decided to maintain its benchmark interest rate for the second consecutive gathering, citing a downtrend in both economic growth and inflation.
Bank Negara Malaysia (BNM) has decided to keep its overnight policy rate (OPR) at 3.00%, which is in agreement with what the market had anticipated. This decision comes after a surprise increase in interest rates in May.
The central bank stated in a release that the ongoing OPR level is still aiding the economy and aligns with the present evaluation of potential inflation and growth.
The economy of the nation in Southeast Asia experienced a significant growth of 8.7% in 2022, marking its highest rate in 22 years, after the restrictions imposed due to the pandemic were removed. However, it has notably slowed down this year due to weak exports.
According to Mohd Afzanizam Abdul Rashid, the head economist at Bank Muamalat Malaysia, BNM has embraced a more cautious approach since its announcement in July, in which it referred to its policy stance as "slightly accommodating".
He anticipates that the official cash rate (OPR) will stay unchanged at 3.00% throughout 2023.
Every single one of the 27 economists surveyed by Reuters had predicted that Bank Negara Malaysia (BNM) would keep the benchmark rate steady, with the majority forecasting that there would be no alterations until the year's end.
According to the statement made by BNM, the potential for economic growth in Malaysia might be impacted by the uncertainties surrounding lower-than-anticipated international demand. However, an increase in tourist activities, a revival in the electronic goods industry, and the swift execution of ongoing and upcoming endeavors will contribute to a positive enhance, as affirmed by BNM.
According to the Bank Negara Malaysia (BNM), both headline and core inflation have also decreased and are predicted to continue declining in the latter part of the year.
The main bank predicts that the overall increase in prices will range from 2.8% to 3.8% in 2023, which is slightly lower than the 3.3% recorded in the previous year.
In the blog post, it is mentioned that the economy expanded by 2.9% during the second quarter, which is the least rapid rate seen in almost two years. Additionally, the central bank cautioned recently that the growth for the entire year is expected to fall towards the lower boundary of their initial projection range of 4% to 5%. (Reported by Danial Azhar and Rozanna Latiff; Edited by Jacqueline Wong)
This blog section is written in informal English.
