Malaysian Monetary Policy Remains on Hold and Appropriately Accommodative
August 25, 2009
Bank Negara’s Overnight Policy Rate was left at 2.0% as expected. This was the fourth consecutive policy meeting to leave policy unchanged. Previously, the rate was cut three times: November 24th by 25 basis points, January 21st by 75 basis points and February 24th by 50 basis points. Malaysia has been in recession with GDP falling 6.2% in the year to 1Q09, and CPI inflation is negative at 2.4% in the year to July. But a statement from officials today reiterated that domestic economic conditions are stabilizing and that the economy is likely to grow in 2H09 and next year despite some continuing global structural adjustments that will need to be made. The 2.0% rate was called “appropriate.”
Copyright Larry Greenberg 2009. All rights reserved. No secondary distribution without express permission.
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