By Zarul Effendi Razali and Anas Abu Hassan<\/p>\n\n\n\n
KUALA LUMPUR, July 8 (Bernama-NNN) — Economists have opined that Bank Negara Malaysia\u2019s (BNM) decision to maintain the Overnight Policy Rate (OPR) at 1.75 per cent today may signal the central bank\u2019s intention to give time for the government\u2019s fiscal policy to have an impact on the economy.<\/p>\n\n\n\n
Juwai IQI chief economist Shan Saeed said at present, BNM is taking the back seat, giving way for the government to be at the front in terms of stimulus packages, of which about seven have been announced since last year.<\/p>\n\n\n\n
\u201cI think if the central bank sees that the economy needs further support (aside from the stimulus packages), they might decrease (the OPR in the future),\u201d he told Bernama.<\/p>\n\n\n\n
He said economies globally have fiscal and monetary policies that come into play during these challenging and uncertain times.<\/p>\n\n\n\n
\u201cYou need a fiscal policy to stimulate growth. You need the monetary policy to boost the business sentiments and domestic consumptions.<\/p>\n\n\n\n
\u201cOne policy alone cannot do the magic. Every policy has got certain limitations. It can make an impact on the economy but beyond a certain level, it can\u2019t make any impact,\u201d he said.<\/p>\n\n\n\n
Shan said last year, the central bank cut the OPR by 125 basis points in total and it would take at least 12-15 months to make an impact on the economy.<\/p>\n\n\n\n
\u201cAny policy lever of instruments that BNM undertakes would take about 12-15 months (to make impact),\u201d he said.<\/p>\n\n\n\n
He said at the moment, what is concerning for the government is to keep the business sentiment strong and the domestic demand intact, and for this, the government is giving various stimulus packages.<\/p>\n\n\n\n
\u201cIn order to create or maintain that momentum of people consuming and buying domestically, they are giving all these fiscal stimulus packages,\u201d he said.<\/p>\n\n\n\n
Meanwhile, Bank Islam Malaysia Bhd chief economist Mohd Afzanizam Abdul Rashid said BNM\u2019s Monetary Policy Committee remains guarded as to how the resurgence of COVID-19 new cases could play out in the near term and how it might affect decisions on lockdown measures and impact on economic activities.<\/p>\n\n\n\n
\u201cBNM has made it quite clear that inflation is not the immediate concern given that it is likely to be transitory, implying that the option to provide additional monetary accommodation is widely open.<\/p>\n\n\n\n
\u201cHowever, we believe BNM may want to put the OPR on hold for as long as possible as it may want to conserve its policy space. We are inclined to put OPR at 1.75 per cent throughout the year,\u201d he added.<\/p>\n\n\n\n
In the meantime, Sunway University\u2019s Professor Dr Yeah Kim Leng said BNM\u2019s assessment and unchanged policy rate could lend support to the view that the country\u2019s economic recovery might be dented but is unlikely to be derailed by the virus resurgence.<\/p>\n\n\n\n
\u201cThe central bank’s decision to maintain the OPR is in line with the expectations of the majority of market economists and analysts.<\/p>\n\n\n\n
\u201cIt has noted the pick-up in economic activities in the first four months of the year and also recognised the dent to the recovery momentum caused by the latest lockdown, but remains sanguine about the recovery prospects through next year,\u201d he added.<\/p>\n\n\n\n
— BERNAMA-NNN<\/p>\n","protected":false},"excerpt":{"rendered":"
By Zarul Effendi Razali and Anas Abu Hassan KUALA LUMPUR, July 8 (Bernama-NNN) — Economists have opined that Bank Negara Malaysia\u2019s (BNM) decision to maintain the Overnight Policy Rate (OPR) at 1.75 per cent today may signal the central bank\u2019s intention to give time for the government\u2019s fiscal policy to have an impact on the […]<\/p>\n","protected":false},"author":28,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[288,300],"tags":[],"_links":{"self":[{"href":"http:\/\/namnewsnetwork.org\/index.php?rest_route=\/wp\/v2\/posts\/129888"}],"collection":[{"href":"http:\/\/namnewsnetwork.org\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/namnewsnetwork.org\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/namnewsnetwork.org\/index.php?rest_route=\/wp\/v2\/users\/28"}],"replies":[{"embeddable":true,"href":"http:\/\/namnewsnetwork.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=129888"}],"version-history":[{"count":0,"href":"http:\/\/namnewsnetwork.org\/index.php?rest_route=\/wp\/v2\/posts\/129888\/revisions"}],"wp:attachment":[{"href":"http:\/\/namnewsnetwork.org\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=129888"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/namnewsnetwork.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=129888"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/namnewsnetwork.org\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=129888"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}