[Reuters, Kuala Lumpur 12th]-The central bank of Malaysia kept its policy rate at 3.00% as expected on the 12th. The central bank expressed the view that domestic demand would support economic growth as the global economy slowed down.
The current policy interest rate is still expressed as “easing”.
The central bank pointed out that some major central banks have eased monetary policy, but “the uncertainties over prolonged trade friction and geopolitical movements may lead to excessive volatility in financial markets.” .
In an economist survey conducted by Reuters, 9 out of 11 people had deferred and 2 had expected a rate cut of 25 basis points (bp).
Continuum Economics analyst Chal Chanana expressed his view that the policy was “preserved” for the interest rate change.
The central bank held its forecast for economic growth at 4.3-4.8% this year. However, he pointed out, “There is a further downside risk associated with worsening trade friction, uncertainties in the global and domestic environment, and prolonged commodities-related sectors.”
UOB Bank economist Julia Goh said, “(I am relieved of the economic growth forecast). (The central bank expects export growth to remain flat over the second half of the year.”)
He expects interest rates to remain unchanged this year, but several other economists said the central bank of Malaysia will implement at least one rate cut after the US Federal Reserve (FRB) rate cut expected next week. Shows how to look.
Capital Economics expects a “near” rate cut to be implemented. “Recent economic growth is solid, but I don't think we can maintain this solidity. Private consumption will slow down as inflation rises sharply.”
The inflation rate in July was 1.4%, the highest level in the past year. The central bank expects inflation to progress from this year to next year.
The central bank cut interest rates by 25 bps in May. It has been the rate cut since 2016.
The central bank said that exports could be offset in part by the global economic slowdown.