Thursday, September 6, 2012

Malaysia holds rate, says low enough to help economy

    The central bank of Malaysia held its benchmark Overnight Policy Rate (OPR) unchanged at 3.0 percent, as expected, saying it considers this rate to be low enough to support the economy during the current global economic uncertainty.
    Bank Negara Malaysia, which has held the OPR unchanged since June 2011, said in a statement after a meeting of its Monetary Policy Committee that domestic demand should o continue to support growth despite a moderation in global economy, which is also affecting emerging economies in Asia.
    "In the MPC's assessment, there continues to be considerable uncertainties in the global economic and financial conditions.  In this environment, the MPC considers the current stance of monetary policy to be accommodative and supportive of the economy," the bank said. 

    Private consumption in Malaysia is supported by higher incomes and stable employment along with investments in domestic-oriented industries, the oil and gas sector and infrastructure projects, the bank said.
    Malaysia's economy expanded by an annual rate of 5.4 percent in the second quarter, up from 4.9 percent in the first quarter and the unemployment rate was 2.8 percent in June.
    The central bank expects inflation to remain moderate for the rest of the year and into 2013 and global energy and commodity prices to remain contained due to the weak global economy. Inflation in Malaysia eased to 1.4 percent in July from 1.6 percent


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