A corner of Kuala Lumpur, Malaysia (Photo: VNA) Kuala Lumpur (VNA) – Malaysia’s economy is expected to remain on thepositive growth trajectory moving forward despite uncertainty on the globaleconomic front, as the country still has ample liquidity buffers, according toBernama news agency.
Inter-Pacific Asset Management Sdn Bhd chief executive officer Datuk Dr NazriKhan Adam Khan said despite a surge in the US inflation recently, Malaysianbonds, namely Malaysian Government Securities, remained stable.
The market is falling not due to economic factors but due to inflation risingfaster than expected, he said, adding Malaysia still has ample liquidity, andthe Bank Negara Malaysia (BNM) cut the interest rate four times last year whilethere is a possibility for the central bank to reduce it further to 1.5 percentfrom 1.75 percent to stimulate the economic growth.
US Federal Reserve Chairman Jay Powell triggered a sudden sell-off in long-termUS Treasury debt and equities, after he vowed to keep monetary policy steady,even as the economy improves and inflation begins to rise.
The US five-year break-even rate, a market-based measure of inflationexpectations, exceeded 2.5 percent on March 3 for the first time since 2008, Bloomberg data show.
Meanwhile,Nazri said that Bursa Malaysia is expected to trend higher next week, touching1,600 points, driven by the downward trend in COVID-19 infections to below2,000 daily cases of late, as well as the continued recovery in oil prices.
Themarket is also expected to gain some support over speculation of a snap 15th general election lingering in the market, he said, adding that it could be heldonce the pandemic is contained as assured by Prime Minister Tan Sri MuhyiddinYassin.
Additionally,the improving of US-China relations under Joe Biden’s administration is alsogood catalyst for Malaysia. As both countries are among our major tradingpartners of Malaysia, the nation should be riding on the positive developmentto grow the economy, he said./.
VNA
