Bank Negara to raise OPR to 3.25pct by March, says Bank Islam chief economist
Bank Islam Malaysia Bhd chief economist Firdaos Rosli said this came amid shrinking monetary accommodation due to the improvements in domestic demand. NSTP/SAIFULLIZAN TAMADI
KUALA LUMPUR: Bank Negara Malaysia is expected to raise its overnight policy rate (OPR) by 25 basis points (bps) tomorrow and another 25 basis points in March, pushing the OPR to 3.25 per cent.
Bank Islam Malaysia Bhd chief economist Firdaos Rosli said this came amid shrinking monetary accommodation due to the improvements in domestic demand.
Firdaos said keeping the OPR low for too long could pose a macroeconomic imbalance amid excessive risk-taking activities.
"The consecutive hikes in OPR, notwithstanding the impact on the overall borrowing cost to the Malaysian economy, are meant to gradually remove the excessive monetary accommodation rather than to tame inflation.
"Thus, we expect the OPR to increase by 50 bps during the first quarter of 2023 (January and March meetings) to its new terminal rate of 3.25 per cent.
"The OPR will likely remain unchanged throughout 2H2023 sans global event risk," he told reporters at the bank's media briefing on 2023 economic outlook.
According to Firdaous, Bank Islam expected Malaysia's real gross domestic product (GDP) to moderate to 4.5 per cent in 2023 as growth headwinds abound.
Bank Islam opines that the new government will steer the economy through the global slowdown, circumventing a recession in 2023.
"Our main concern will be sustaining Malaysia's growth momentum in
2023.
"We expect Malaysia's GDP to come in at 8.1 per cent in 2022, exceeding the official projections of between 6.5 per cent to 7.0 per cent.
"However, growth headwinds abound in 2023, and we believe that Malaysia's real GDP growth will moderate to 4.5 per cent, steeper than others in the region," he said.
Meanwhile, Firdaos said Malaysia's inflation had peaked in 2022 and would moderate amid favourable US dollar-ringgit exchange rates and base effects.
He said prices would remain elevated in 2023, though.
Bank Islam expects the headline inflation to average 3.0 per cent in 2023 from 3.4 per cent in 2022, assuming that the government maintained the current fuel subsidy.
"However, inflation will inevitably trend higher than the bank's baseline (3.0 per cent) if the government proceeds with subsidy rationalisation in 2023 as retail oil prices increase.
"We expect the consumer price index (CPI) to increase by 0.42 per cent above the baseline for every 10 cent increase in RON95," he said.
Firdaos said the ringgit was expected to end 2023 at RM4.28 against US dollar amid easing US interest rate cycle.
Firdaos said this time last year, the ringgit's outlook was largely positive when the local note ended at RM4.17 on its first trading day of the year.
"Moderating global growth may affect the ringgit's recovery trajectory. However, we are optimistic that resilient domestic growth and intensified China's economic reopening can support the local note's value.
"We expect the ringgit to end the year at RM4.28 from RM4.40 in 2022," he added.
https://www.nst.com.my/business/2023/01/871405/bank-negara-raise-opr-325pct-march-says-bank-islam-chief-economist
Singapore Investment
-
-
-
-
Lloyds Bank4 hours ago
-
-
-
-
-
-
-
-
-
-
Best Areas in Phnom Penh to Buy Property23 hours ago
-
-
-
-
-
Orchids of Angkor Wat1 day ago
-
-
-
-
Few Reflections1 day ago
-
Die With Zero (Bill Perkins)1 day ago
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Weekly Market Outlook5 days ago
-
-
-
Top 5 Dividend Stocks on SGX6 days ago
-
Be anti-fragile6 days ago
-
-
-
-
-
-
-
-
-
-
-
随心笔:忧郁1 week ago
-
-
-
Finance Investment Movement 471 week ago
-
-
-
-
-
SG GEMS 2024 by AlphaInvest2 weeks ago
-
-
Lentor Hills Residences2 weeks ago
-
MIT vs MLT. Which To Choose?2 weeks ago
-
-
-
-
Monthly IBKR Update – June 20242 weeks ago
-
-
-
At the Half Year Mark3 weeks ago
-
-
-
-
-
-
Portfolio Summary for June 20243 weeks ago
-
-
-
-
-
Jun 2024 Portfolio3 weeks ago
-
Gone Fishing3 weeks ago
-
2Q 2024 Investment Strategy Update3 weeks ago
-
A Giant Sucking Sound…4 weeks ago
-
-
Portfolio (June 30, 2024)4 weeks ago
-
-
Oh My Spins Casino Login App4 weeks ago
-
-
-
-
-
-
-
-
Free money again! Don't say #bojio.1 month ago
-
-
-
-
-
-
-
Breakthroughs in portfolio :)2 months ago
-
Bond Coupons vs Rental Income2 months ago
-
-
-
Resilience and Adaptability = Confidence2 months ago
-
-
-
China’s going downhill?2 months ago
-
-
iFAST 1Q24: Firing on all cylinders2 months ago
-
-
2024 (Portfolio Update)3 months ago
-
-
Feb 2024 Expenditure4 months ago
-
New Bitcoin All Time High Before Halving4 months ago
-
-
-
The Market Is A Scam!4 months ago
-
-
-
-
Options Trading Journal Jan 20245 months ago
-
-
-
-
-
Year 2023 DIYQuant Portfolio Performance Report6 months ago
-
Monthly Summary of November 20237 months ago
-
Migration of website8 months ago
-
-
-
-
-
-
-
-
-
-
-
-
A New Light1 year ago
-
-
-
-
-
-
-
2022 Thoughts, Hello 2023!1 year ago
-
Series of Defaults for Maple Finance1 year ago
-
Takeaways from “Sea Change”1 year ago
-
Greed is Coming Back1 year ago
-
-
-
-
-
-
-
-
-
-
-
What is Overemployment2 years ago
-
Terra Hill Condo (former Flynn Park)2 years ago
-
Alibaba VS Tencent: The Battle Royale2 years ago
-
-
-
-
-
-
-
-
-