Bank Negara Malaysia seen maintaining OPR on 2Q GDP growth — analysts
KUALA LUMPUR (Aug 21): CIMB Investment Bank Bhd and Public Investment Bank Bhd said Bank Negara Malaysia is expected to maintain the Overnight Policy Rate (OPR) at 3% until end of 2017, after Malaysia reported second quarter (2Q17)economic growth at 5.8% from a year earlier.
In a note today, CIMB said the nation's 2Q17 5.8% economic growth, as measured by gross domestic product (GDP), compares with CIMB's and consensus forecast at 5.7% and 5.4% respectively.
"With the economy exhibiting resilience, we think monetary policy will remain on an extended pause, and hence reiterate an end-2017 Overnight Policy Rate forecast of 3.00%. Malaysia’s external position remains exposed to the volatility of portfolio flows, which are susceptible to turning on a dime, when market sentiment weakens," CIMB said.
Public Investment wrote in a note today that the research firm did not foresee risk to growth in the country's economy at this juncture.
"Additionally, the pressure to inflation is likely to be transitory in nature. Given that, we don’t foresee the need for OPR to be adjusted either way, as it is seen as accommodative and conducive for the economy," Public Investment said. — theedgemarkets.com
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