Malaysia central bank to deliver two more 25-bp rate hikes this year
Malaysia's central bank will deliver a third consecutive 25 basis point interest rate hike on Thursday and a fourth in November to quell growing inflationary pressures but will opt to move slowly despite a hawkish U.S. Federal Reserve, a Reuters poll found.
Although Malaysian inflation rose to 4.4% in July, well above the target range of 2-3%, it is relatively moderate compared with other Southeast Asian countries, allowing the central bank to move at a slower pace.
Bank Negara Malaysia (BNM) has raised rates by a modest 50 basis points since May to 2.25%.
All but one of 20 economists in the Aug. 30-Sept. 5 Reuters poll forecast BNM to hike by 25 basis points to 2.50% at its Sept. 8 meeting. If realised, it would be the first time since 2010 the central bank raised rates three times in a row. (MYINTR=ECI)
One economist expected a 50 basis point hike.
"Given a robust GDP growth print in 2Q22, signs of further economic expansion in 2H22 albeit at a moderate pace, and broadening second-round effects on inflation, Bank Negara Malaysia will likely follow-through with a third 25bps rate hike," noted Julia Goh, senior economist at UOB. Read More...
