PETALING JAYA: As expected, Bank Negara Malaysia has decided to maintain the Overnight Policy Rate (OPR) at 3% at its Monetary Policy Committee (MPC) meeting today.
The central bank said in a statement that the MPC will continue to assess the balance of risks to domestic growth and inflation, to ensure that the monetary policy stance remains conducive to sustainable growth amid price stability.
“At the current level of the OPR, the stance of monetary policy remains accommodative and supportive of economic activity.”
While the 2019 growth forecast of 4.3% to 4.8% for the Malaysian economy remains unchanged, BNM said it is subject to further downside risks from worsening trade tensions, uncertainties in the global and domestic environment, and extended weakness in commodity-related sectors.
However, it noted that Malaysia’s diversified exports will partly mitigate the impact of softening global demand.
BNM also cautioned that the recent escalation of trade tensions points to weaker global trade going forward, with increasing signs of spillovers to domestic economic activity in a number of countries.
“Monetary policy easing in several major economies has eased global financial conditions, but uncertainty from the prolonged trade disputes and geopolitical developments could lead to excessive financial market volatility.”
source https://www.thesundaily.my/business/bnm-keeps-key-interest-rate-at-3-warns-of-downside-risks-from-trade-spat-KY1364095
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