Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Malaysia's central bank seen holding rates to assess economic risks: Reuters poll

EconomyJul 05, 2019 03:26AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 

KUALA LUMPUR (Reuters) - Malaysia's central bank will likely hold its benchmark interest rate steady at a policy review on Tuesday, to assess the effects of a rate cut in May and give itself room for more easing if economic growth falters later this year, a Reuters poll found.

All 11 economists surveyed expect Bank Negara Malaysia (BNM) to keep its overnight policy rate unchanged at 3.00%, even as the country's export growth lost momentum and inflation remained benign in the first five months of the year.

In May, Malaysia's central bank became the first in Southeast Asia to cut interest rates this year as it moved to bolster its economy on concerns about slowing global growth and the impact from the Sino-U.S. trade war.

The cut was Malaysia's first since July 2016, and reflected changes in global interest rates and the increasingly dovish stance of many central banks over the first half of the year.

"The central bank will likely wait a little longer before penciling in one more rate cut," HSBC said in a research note on Friday.

"We expect BNM to ease in 4Q19 when domestic demand will start slowing."

Malaysia's exports in May rose 2.5% from a year earlier, slower than expected, on a decline in shipments of manufactured goods to major trade partner China.

Annual inflation in May remained unchanged at 0.2% for the third month in a row. Inflation has been mild since an unpopular consumption tax was scrapped in June 2018, while transport costs have declined after the government put a cap on domestic fuel prices.

BNM will likely take a more "reactive" stance on its key rate, with an eye on whether the U.S. Federal Reserve decides to cut interest rates later this year, said Irvin Seah, senior economist at DBS in Singapore.

Expectations the Fed could cut rates at its July 30-31 meeting are rising, and some investors are betting it could cut by as much as 100 basis points in the coming year.

Seah said Malaysia's central bank still needs to wait for the effects of its May cut to kick in before it can decide on another rate change.

"If they see a need to have a more aggressive rate cut, they should have done a one-shot 50 point cut earlier on," Seah said.

Malaysia's central bank seen holding rates to assess economic risks: Reuters poll
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email