Malaysia CB Likely to Hold Key Rate

Malaysia’s central bank is expected to hold its benchmark rate on Thursday, as the economy has improved after struggling due to poor global oil and commodity prices for more than a year, Malaymail online reported. Southeast Asia’s third-largest economy saw stronger growth over the past two quarters on an uptick in exports, though recovery has been offset by continued weakness in the ringgit currency. Nine out of 10 economists polled by Reuters forecast Bank Negara Malaysia will keep its overnight rate at 3% on Thursday. Kenanga Investment Bank said economic indicators in recent months provide little reason for the central bank to follow up on its 25 basis point cut in July, and that the present rate is “accommodative” for growth. After slowing for five straight quarters, annual growth rose to 4.3% in July-September and 4.5% in 2016’s final quarter. Full-year 2016 growth came in at 4.2%, the slowest since the economy contracted in 2009.