Thursday February 16 2017
Malaysia GDP Growth Strongest In A Year In Q4
Bank Negara Malaysia | Rida Husna | rida@tradingeconomics.com

Malaysian economy expanded 4.5 percent year-on-year in the fourth quarter of 2016, compared to a 4.3 percent growth in the previous three months and in line with markets expectations. It was the strongest expansion since the December quarter 2015, mainly supported by a rebound in exports and a faster increase in investment while private consumption remained robust.

In the December quarter, private consumption grew by 6.2 percent year-on-year, slower than  a 6.4 percent rise in the previous quarter, supported by continued wage and employment growth. Public consumption contracted by 4.2 percent, compared to a 2.2 percent growth in the third quarter, due to rationalisation of  spending on supplies and services and a moderation in growth of spending on emoluments. Gross fixed capital formation rose 2.4 percent, faster than a 2.0 percent expansion in the preceding quarter. Private investment advanced by 4.9 percent, following a 4.7 percent rise in the third quarter, supported by continued capital spending in the services and manufacturing sectors. Meanwhile, public investment remained in contraction, following a 3.8 percent decline in the prior quarter. Exports rose 1.3 percent, rebounding from  a 1.3 percent decline in the September quarter. Imports also went up 0.7 percent, compared to a 2.3 percent fall in the previous three months.

On the production side, services sector grew the most by 5.5 percent (from 6.1 percent in the preceding three months, supported primarily by consumption-related services), followed by construction (5.1 percent from 7.9 percent, largely driven by the civil engineering sub-sector), mining (4.9 percent from 3.0 percent, due to an increase of natural gas output) and manufacturing (4.8 percent from 4.2 percent, supported by higher growth in both domestic and export-oriented industries). In contrast, the agriculture sector shrank 2.4 percent, slowing from a 6.1 percent contraction in the September quarter, due to diminishing impact of El Nino on crude palm oil yields. 

Moving forward, the external environment may continue to remain challenging while the Malaysian economy will experience sustained growth with the primary driver being domestic demand. Private consumption is anticipated to remain supported by wage and employment growth, with additional impetus coming from announced Government measures to support disposable income of households. Investment activity will continue to be anchored by the on-going implementation of infrastructure projects and capital spending in the manufacturing and services sectors.

On a quarter-on-quarter seasonally-adjusted basis, the economy grew by 1.4 percent, the same as a downwardly revised 1.4 percent growth in the previous period.

Considering full 2016, the economy advanced 4.2 percent, compared to a 5.0 percent expansion in 2015.






Wednesday February 08 2017
Malaysia Trade Surplus Narrows To 3-Month Low
Statistics malaysia l Rida Husna | rida@tradingeconomics.com

Malaysia reported a MYR 8.72 billion trade surplus in December of 2016, compared to a MYR 8.25 billion surplus a year earlier while market expected a MYR 9.30 billion surplus. It was the smallest surplus since September, as imports rose more than exports.

Year-on-year sales increased by 10.7 percent to MYR 75.6 billion, following a 7.8  percent rise in November and above market consensus of a 9.4 percent growth. It was the second straight month of, as sales went up for: electrical & electronic products (9.0 percent to MYR 27.0 billion, 35.8 percent of total exports), palm oil and palm based products (+24.5 percent to MYR 6.4 billion, 8.5 percent share), crude petroleum (15.9 percent to MYR 2.5 billion, 3.3 percent share), natural rubber (39.0 percent to MYR 426.9 million, 0.6 percent share) and timber and timber-based products (4.5 percent to MYR 2.1 billion, 2.7 percent share). In contrast, outbound shipments fell slightly for LNG (-0.5 percent to MYR 3.8 billion, 5.0 percent share).

Exports increased to China (22.2 percent), the US (+1.7 percent) and the EU countries (5.8 percent).

Imports went up 11.5 percent to MYR 66.8 billion, compared to a 11.2 percent growth in the preceding month and higher than market expectations of a 9.0 percent increase. It was also the second consecutive month of rise, as purchases went up for all categories: intermediate goods (9.8 percent, due to industrial supplies, processed: 14.2 percent; parts & accessories of capital goods except transport equipment: 8.1 percent and fuel & lubricants, processed, others: +58.8 percent and fuel & lubricants, primary: 78.7 percent), capital goods (13.4 percent, due to an increase in capital goods except transport equipment: 13.8 percent) and consumption goods  (9.6 percent, due to an increase in food & beverages, primary, mainly for household consumption: 15.6 percent and durables: 15.6 percent).

In November 2016, trade surplus stood at MYR 9.03 billion. 




Thursday January 19 2017
Malaysia Holds Key Rate Steady at 3% in January
Bank Negara Malaysia l Rida Husna | rida@tradingeconomics.com

Malaysia's central bank left its benchmark overnight policy rate unchanged at 3.0 percent on January 19th 2017, as expected. While saying that headline inflation is expected to average higher this year amid the prospect of global oil prices, policymakers are confident these factors would not cause significant spillovers to the broader price trends, given the stable domestic demand conditions.

Statement by the Bank Negara Malaysia:

The global economy continued to grow at a moderate pace. Economic activity in the major advanced economies has improved. In Asia, growth is supported by domestic demand amid some recovery in external demand. For 2017, the global economy is projected to expand at a slightly faster pace. The prospect of a shift towards progressive use of fiscal policy in the developed economies could lead to a more balanced policy environment that would support growth. Nevertheless, heightened uncertainty and downside risks to global growth remain, arising from risks of protectionism, geopolitical developments and commodity price volatility. These risks could also lead to episodes of increased financial market volatility.

For Malaysia, latest indicators point to continued expansion in the fourth quarter of 2016. Going forward, private sector activity will remain the key driver of growth. Private consumption is expected to be sustained by continued wage and employment growth, with support from various policy measures to raise disposable income. Investment activity, although moderating, will be supported by on-going infrastructure development projects and capital spending in the manufacturing and services sectors. On the external front, the expected improvement in exports will provide some support to growth. Overall, the economy remains on track to expand as projected.

Headline inflation averaged 2.1 percent in 2016 and is expected to average higher in 2017, amid the prospect of higher global oil prices. These cost factors are not expected to cause significant spillovers to the broader price trends, given the stable domestic demand conditions. Underlying inflation, as measured by the core inflation index, is therefore expected to remain stable.

The ringgit, along with other emerging market currencies, has seen a reduction in volatility since the sharp adjustments experienced towards the end of 2016. The implementation of financial market development measures has provided stability to the domestic foreign exchange market. Uncertainties in the global economy, the policy environment and geopolitical developments may, however, result in bouts of volatility in the regional financial and foreign exchange markets. In this regard, Bank Negara Malaysia will continue to provide liquidity to ensure the orderly functioning of the financial markets. Banking system liquidity remains ample. Financial institutions continue to operate with strong capital and liquidity buffers and the growth of financing to the private sector is consistent with the pace of economic activity.

At the current level of the OPR (Overnight Policy Rate), the degree of monetary accommodativeness is consistent with the policy stance to ensure that the domestic economy continues on a steady growth path amid a stable core inflation, supported by sustained financial intermediation in the economy. While the risks of destabilising financial imbalances are contained, the MPC will monitor these risks to ensure the sustainability of the overall growth prospects. The MPC will continue to assess the balance of risks surrounding the outlook for domestic growth and inflation.




Wednesday January 18 2017
Malaysia Inflation Rate Steady at 1.8% in December
Statistics of Malaysia | Chusnul Ch Manan l chusnul@tradingeconomics.com

Consumer prices in Malaysia rose 1.8 percent year-on-year in December of 2016, the same as in November but slightly below markets expectations of a 1.9 percent rise. The inflation rate remained at the highest level since May, mainly due to rising prices of food and non alcoholic beverages while inflation for housing & utilities were steady and cost of transport fell much less than in a month earlier. Core consumer prices rose 2.1 percent year-on-year in December, compared to a 2.2 percent gain in November. On a monthly basis, consumer prices were flat, after a 1.0 percent rise in the preceding month.

Year-on-year, prices increased at a faster pace for : recreation services & culture (+3.3 percent from +3.2 percent). Prices rose at a slower pace for :  food & non-alcoholic beverages (+3.7 percent from +3.8 percent in November), alcoholic beverages & tobacco (+0.1 percent from +1.9 percent), education (+1.7 percent from +1.9 percent) and health (+2.4 percent from +2.5 percent). Prices steady for : housing, water, electricity, gas & other fuels (2.1 percent); furnishing, household equipment and routine maintenance (+1.4 percent); restaurants & hotels (+1.9 percent), and miscellaneous goods & services (+1.8 percent). In contrast, downward prices pressure came from: clothing and footwear (-0.5 percent from -0.5 percent), transport (-0.6 percent from -1.5 percent), and communication (-2.6 percent from -2.7 percent).
 
Among food & non-alcoholic beverages, customers had to pay more for all categories: food (+3.8 percent from +4.0 percent); food at home (+4.1 percent from +4.2 percent); rice, bread & other cereals (+0.7 percent from +0.9 percent); meat (+3.0 percent from +6.0 percent); fish & seafood (+5.6 percent from +4.5 percent); milk & eggs (+0.1 percent from +1.1 percent), oils & fats (+36.9 percent from +36.6 percent), fruits (+2.7 percent from +2.7 percent); vegetables (+4.8 percent from +3.6 percent); sugar, jam, honey, chocolate & confectionary (+2.0 percent from +1.9 percent); food products (+5.4 percent from +5.8 percent), food away from home (+3.5 percent from +3.4 percent) and coffee, tea, cocoa & non-alcoholic beverages (+0.3 percent from +0.1 percent).
 
Core consumer prices rose 2.1 percent year-on-year in December, compared to a 2.2 percent gain in November.

On a monthly basis, consumer prices were flat, after a 1 percent gain in a month earlier. Prices went up at a faster pace for: restaurants & hotels ( +0.2 percent from +0.1 percent). Prices steady for :  furnishing, household equipment and routine maintenance ( +0.1 percent). Prices rose at a slower pace for : food & non-alcoholic beverages & tobacco ( +0.6 percent from +1.0 percent) and health (+0.2 percent  from +0.3 percent). Prices were flat for housing, water, electricity, gas & other fuels (from +0.5 percent) and education (from +0.1 percent). In contrast prices fell for miscellaneous goods and services ( -0.2  percent from +0.5 percent) and transport (-1.4 percent  from +4.5 percent).
 
 
 
 




Wednesday January 18 2017
Malaysia Inflation Rate Steady at 1.8% in December
Statistics of Malaysia l Chusnul Ch Manan | chusnul@tradingeconomics.com

Consumer prices in Malaysia rose 1.8 percent year-on-year in December of 2016, the same as in November but slightly below markets expectations of a 1.9 percent rise. The inflation rate remained at the highest level since May, mainly due to rising prices of food and non alcoholic beverages while inflation for housing & utilities were steady and cost of transport fell less than in a month earlier. Core consumer prices rose 2.1 percent year-on-year in December, compared to a 2.2 percent gain in November. On a monthly basis, consumer prices were flat, after a 1.0 percent rise in a month earlier.

Year-on-year, upward prices pressure came from: food & non-alcoholic beverages (+3.7 percent from +3.8 percent in November), alcoholic beverages & tobacco (+0.1 percent from +1.9 percent); housing, water, electricity, gas & other fuels (2.1 percent from +2.1 percent); furnishing, household equipment and routine maintenance (+1.4 percent from +1.4 percent), health (+2.4 percent from +2.5 percent), recreation services & culture (+3.3 percent from +3.2 percent), education (+1.7 percent from +1.9 percent), restaurants & hotels (+1.9 percent from +1.9 percent) and miscellaneous goods & services (+1.8 percent from +1.8 percent). In contrast, downward prices pressure came from: clothing and footwear (-0.5 percent from -0.5 percent), transport (-0.6 percent from -1.5 percent) and communication (-2.6 percent from -2.7 percent).
 
Among food & non-alcoholic beverages, customers had to pay more for all categories: food (+3.8 percent from +4.0 percent); food at home (+4.1 percent from +4.2 percent); rice, bread & other cereals (+0.7 percent from +0.9 percent); meat (+3.0 percent from +6.0 percent); fish & seafood (+5.6 percent from +4.5 percent); milk & eggs (+0.1 percent from +1.1 percent), oils & fats (+36.9 percent from +36.6 percent), fruits (+2.7 percent from +2.7 percent); vegetables (+4.8 percent from +3.6 percent); sugar, jam, honey, chocolate & confectionary (+2.0 percent from +1.9 percent); food products (+5.4 percent from +5.8 percent), food away from home (+3.5 percent from +3.4 percent) and coffee, tea, cocoa & non-alcoholic beverages (+0.3 percent from +0.1 percent).
 
Core consumer prices rose 2.1 percent year-on-year in December, compared to a 2.2 percent gain in November. 
 
On a monthly basis, consumer prices unchanged, after a 1 percent gain in a month earlier. Prices went up for: food & non-alcoholic beverages & tobacco ( +0.6 percent from +1.0 percent); furnishings, household equipment and routine maintenance ( +0.1 percent from +0.1 percent), health (+0.2 percent  from +0.3 percent), transport (-1.4 percent  from +4.5 percent), education (0 percent from +0.1 percent), restaurants & hotels ( +0.2 percent from +0.1 percent) and miscellaneous goods and services ( -0.2  percent from +0.5 percent). Prices were flat for housing, water, electricity, gas & other fuels (from +0.5 percent).
 
 
 
 




Friday January 06 2017
Malaysia Trade Surplus Below Consensus in November
Statistics Malaysia l Rida Husna | rida@tradingeconomics.com

Malaysia posted a MYR 9.0 billion trade surplus in November of 2016, narrowing from a MYR 10.2 billion surplus a year earlier while market expected a MYR 10.1 billion surplus, as imports rose more than exports.

Year-on-year sales increased by 8.0 percent to MYR 72.8 billion, rebounding from a 8.6 percent drop in October and beating market consensus of a 1.4 percent gain. It was the first rise since August, as sales went up for: electrical & electronic products (+13.2 percent to MYR 26.2 billion, 35.9 percent of total exports), palm oil and palm based products (+24.3 percent to MYR 6.6 billion, 9.1 percent share), natural rubber (+27.6 percent to MYR 332.1 million, 0.5 percent share), timber and timber-based products (+2.1 percent to MYR 1.9 billion, 2.6 percent share) and refined petroleum products (+0.1 percent to MYR 4.4 billion, 6.0 percent share). In contrast, outbound shipments fell for: LNG (-21.3 percent to MYR 3.1 billion, 4.3 percent share) and crude petroleum (+6.1 percent to MYR 2.5 billion, 3.4 percent share).

Exports increased to China (+11.2 percent), the US (+9.8 percent) and Singapore (+15.4 percent). In contrast, sales was down to Japan (-1.5 percent) and Thailand (-0.6 percent).

Imports went up 11.2 percent to MYR 63.8 billion, compared to a 6.6 percent drop in the preceding month and much higher than market expectations of a 3.0 percent growth. It was the first increase in three months, as purchases went up for all categories: intermediate goods (+11.3 percent, due to industrial supplies, processed: +20.9 percent, fuel & lubricants, processed, others: +58.8 percent and fuel & lubricants, primary: +86.3 percent), capital goods (+13.1 percent, due to an increase in both capital goods except for transport equipment: +10.0 percent) and transport equipment, industrial (+42.0 percent) and consumption goods  (+5.4 percent, due to an increase in non-durables: +17.6 percent and semi-durables: +5.9 percent).

In October 2016, trade surplus stood at MYR 9.8 billion.



Wednesday December 21 2016
Malaysia Inflation Rate at 6-Month High of 1.8% in November
Statistics Malaysia l Rida Husna | rida@tradingeconomics.com

Consumer prices in Malaysia rose 1.8 percent year-on-year in November of 2016, compared to a 1.4 percent increase in October and above market estimates of a 1.6 percent rise. It was the highest inflation rate since May, mainly due to a faster increase in prices of food and non alcoholic beverages while cost of transport fell less than in a month earlier and inflation for housing & utilities were steady.

Year-on-year, upward prices pressure came from: food & non-alcoholic beverages (+3.8 percent from +2.5 percent in October), alcoholic beverages & tobacco (+1.9 percent from +19.8 percent); housing, water, electricity, gas & other fuels (2.1 percent from +2.1 percent); furnishing, household equipment and routine maintenance (+1.4 percent from +1.5 percent), health (+2.5 percent from +2.3 percent), recreation services & culture (+3.2 percent from +3.5 percent), education (+1.9 percent from +2.0 percent), restaurants & hotels (+1.9 percent from +2.0 percent) and miscellaneous goods & services (+1.8 percent from +1.5 percent). In contrast, downward prices pressure came from: clothing and footwear (-0.5 percent from -0.5 percent), transport (-1.5 percent from -5.5 percent) and communication (-2.7 percent from -2.6 percent).

Among food & non-alcoholic beverages, customers had to pay more for all categories: food (+4.0 percent from +2.6 percent); food at home (+4.2 percent from +2.2 percent); rice, bread & other cereals (+0.9 percent from +1.0 percent); meat (+6.0 percent from +2.4 percent); fish & seafood (+4.5 percent from +5.0 percent); milk & eggs (+1.1 percent from +0.2 percent), oils & fats (+36.6 percent from +0.3 percent), fruits (+2.7 percent from +3.1 percent); vegetables (+3.6 percent from -1.1 percent); sugar, jam, honey, chocolate & confectionary (+1.9 percent from +2.0 percent); food products (+5.8 percent from +5.8 percent), food away from home (+3.4 percent from +3.3 percent) and coffee, tea, cocoa & non-alcoholic beverages (+0.1 percent from +0.3 percent). 

Core consumer prices rose 2.2 percent year-on-year in November, compared to a 2.0 percent gain in October. It was the highest level since August.

On a monthly basis, consumer prices rose 1.0 percent, after a 0.3 percent gain in a month earlier. It was the highest figure since July 2008, as prices went up for: food & non-alcoholic beverages & tobacco (+1.0 percent); housing, water, electricity, gas & other fuels (+0.5 percent); furnishings, household equipment and routine maintenance (+0.1 percent), health (+0.3 percent), transport (+4.5 percent), education (+0.1 percent), restaurants & hotels (+0.1 percent) and miscellaneous goods & services (+0.5 percent). In contrast, cost declined for: communication (-0.1 percent) and recreation & culture (-0.2 percent). Prices remained unchanged for: alcoholic beverages & tobacco and clothing and footwear.


Wednesday December 07 2016
Malaysia Trade Surplus Beats Forecasts in October
Statistics of Malaysia | Chusnul Ch Manan | chusnul@tradingeconomics.com

Malaysia posted a MYR 9.8 billion trade surplus in October of 2016, narrowing from a MYR 12.2 billion surplus a year earlier but beating market estimates of a MYR 8.1 billion surplus, as exports fell more than imports.

Year-on-year sales declined by 8.6 percent to MYR 69.2 billion, following a 3.0 percent drop in September and faster than market estimates of a 5.8 percent fall. It was the second straight month of decline and the largest drop since April 2015, as sales decreased for: crude petroleum (-27.9 percent), LNG (-40.2 percent), timber and timber based products (-11.4 percent) and refined petroleum products (-1.4 percent). In contrast, outbound shipments increased for:  palm oil and palm based products (+2.1 percent) and electrical & electronic products (+1.2 percent).
 
Exports dropped to the EU (-12 percent), the US (-3.5 percent), Japan (-29.1 percent), Singapore (-7.5 percent), and Thailand (-8.9 percent). In contrast, outbound shipments rose to China (+3.4 percent). 
 
Imports fell 6.6 percent year-on-year to MYR 59.4 billion, compared to a 0.1 percent drop in the preceding month and much higher than market consensus of a 0.2 percent fall. Purchases went down for all categories: capital goods (-2.0 percent, due to both capital goods except for transport equipment: -9.1 percent) ; consumption goods  (-8.0 percent, due to food & beverages processed, mainly for household: -11.6 percent and semi-durable: -9.2 percent), and intermediate goods (-8.9 percent, due to parts & accessories of capital goods except transport equipment : -11.9 percent and fuels & lubricants, processed, others : -52.2 percent).
 
In September 2016, trade surplus stood at MYR 7.6 billion.
 
 
 
 
 
 
 
 
 


Friday November 25 2016
Malaysia Inflation Rate at 3-Month Low of 1.4% in October
Statistic of Malaysia l Chusnul Ch Manan | chusnul@tradingeconomics.com

Consumer prices in Malaysia rose 1.4 percent year-on-year in October of 2016, compared to a 1.5 percent increase in September. It was the lowest figure since July while market expected a 1.5 percent gain, as prices of food and non alcoholic beverage rose at a slower pace while inflation for housing & utilities were steady and cost of transport fell at the same pace as in a month earlier.

Year-on-year, cost rose at a slower pace for: food & non-alcoholic beverages (+2.5 percent from +3.0 percent in September), restaurants & hotels (+2.0 percent from +2.2 percent), but rose slightly faster for alcoholic beverages & tobacco (+19.8 percen from +19.7 percentt); recreation services & culture (+3.5. percent from +3.4 percent); furnishing, household equipment & routine maintenance (+1.5 percent from 1.3 percent), and health (+2.3 percent from +2.2 percent). Inflation was steady for: miscellaneous goods & services (+1.5 percent); housing, water, electricity, gas & other fuels (+2.1 percent), and education (+2.0 percent). In contrast, prices declined for: clothing & footwear (-0.5 percent), transport (-5.5 percent), and communication (-2.6 percent).

Among food & non-alcoholic beverages, customers had to pay more for: food (+2.6 percent from +3.1 percent); food at home (+2.2 percent from +2.8 percent); rice, bread & other cereals (+1.0 percent from +1.0 percent); meat (+2.4 percent from +4.2 percent); fish & seafood (+5.0 percent from +4.8 percent); milk & eggs (+0.2 percent from +0.9 percent), oils & fats (+0.3 percent from +0.3 percent), fruits (+3.1 percent from +3.3 percent); sugar, jam, honey, chocolate & confectionary (+2.0 percent from +1.9 percent); food products (+5.8 percent from +6.1 percent), food away from home (+3.3 percent from +3.4 percent) and coffee, tea, cocoa & non-alcoholic beverages (+0.3 percent from +0.2 percent). In contrast, prices of vegetables fell 1.1 percent (from +1.6 percent in September). 
 
Core consumer prices rose 2.0 percent year-on-year in October, compared to a 2.1 percent gain in September.
 
On a monthly basis, consumer prices rose 0.3 percent, after falling 0.3 percent in a month earlier. Prices went up for: alcoholic beverages & tobacco (+0.1 percent); housing, water, electricity, gas & other fuels (+0.3 percent); furnishings, household equipment and routine maintenance (+0.2 percent), health (+0.3 percent), transport (+3.1 percent) and recreation services & culture (+0.1 percent), education (+0.2 percent). In contrast, cost declined for: food and alcoholic beverages (-0.2 percent) and miscellaneous goods & services (-0.1 percent). Prices remained unchanged for: clothing and footwear, communication and restaurants and hotels.




Wednesday November 23 2016
Malaysia Holds Key Interest Rate Steady at 3%
Bank Negara Malaysia l Rida Husna | rida@tradingeconomics.com

The central bank of Malaysia left its benchmark overnight policy rate unchanged at 3 percent on November 23rd 2016, as expected. While saying that headline inflation for 2016 will be at the lower end of the projected range of 2.0 – 2.5 percent, policymakers judged at the current level of interest rate, the degree of monetary accommodativeness is consistent with the policy stance to ensure the domestic economy continues on a steady growth path.

Statement by the Bank Negara Malaysia:

The global economy continued to grow at a moderate pace. Economic activity in major advanced economies has improved but remains moderate. In Asia, growth has been supported by domestic demand amid persistent weakness in the external sector. Looking ahead, the baseline estimate is for global growth to improve slightly in 2017. The prospect of a shift towards progressive use of fiscal policy in the developed economies could lead to a more balanced policy environment that would support growth going forward. Nevertheless there is uncertainty arising from risks of protectionism and financial market volatility. Global financial market conditions are likely to be susceptible to policy and market developments.

The domestic economy continued to expand in the third quarter of the year, driven mainly by private sector activity with some support from net exports. Going forward, private sector activity will remain the key driver of growth. Private consumption is expected to be sustained by continued wage and employment growth, with additional support from Government measures to increase disposable income. Investment activity, although moderating, will be supported by on-going infrastructure investments and capital expenditure in the manufacturing and services sectors. On the external front, exports are expected to expand but will be constrained by soft demand from Malaysia’s key trading partners. Overall, the domestic economy remains on track to expand as projected in 2016 and 2017.

Headline inflation for 2016 is expected to be at the lower end of the projected range of 2.0 – 2.5 percent. Inflation is expected to remain relatively stable in 2017 given the environment of low global energy and commodity prices, and generally subdued global inflation.

The ringgit, along with most emerging market currencies, has experienced sharp adjustments and significant volatility due to continuing uncertainties in global economic and policy environment, and geopolitical developments. These factors could result in periods of volatility in the regional financial and foreign exchange markets. In this regard, Bank Negara Malaysia will continue to provide liquidity to ensure the orderly functioning of the domestic foreign exchange market. The capital market remains accessible, deep and liquid. Banking system liquidity is ample. Financial institutions continue to operate with strong capital and liquidity buffers and the growth of financing to the private sector is consistent with the pace of economic activity.

At the current level of the Overnight Policy Rate (OPR), the degree of monetary accommodativeness is consistent with the policy stance to ensure that the domestic economy continues on a steady growth path amid stable inflation, supported by continued healthy financial intermediation in the economy. The risk of destabilising financial imbalances has been contained. However, the MPC will be monitoring these risks to ensure the sustainability of the overall growth prospects.