HSBC Global Research projects that Bank Negara Malaysia (BNM) will maintain the Overnight Policy Rate (OPR) at 1.75% this year.
Bernama reported that previously, HSBC expected a decline in OPR in the first quarter of this year.
In a note today, HSBC had earlier asked the central bank to make another final 25-point reduction on the OPR at a meeting of the Monetary Policy Committee to be held tomorrow.
According to Chief Economist (ASEAN) Joseph Incalcaterra, the recent drop in Covid-19 cases, the gradual easing of movement restrictions, the earlier than expected on vaccine drivers, optimistic data and the government's pledge to 'target support, " all of which point to the possibility of a drop in policy rates.
"However, we are confident that the decision on March 4 will be a difficult decision to make, in addition to the unavoidable downturn due to significant growth this year due to travel restrictions.
"Besides, in the event of unforeseen circumstances and meaning worse, BNM remains one of the central banks in the region which can provide more support for easier monetary policy," he said.
