Interest rate hike pause likely on falling commodities

KUALA LUMPUR: Falling commodity prices will confer spillover benefits on taming inflationary pressures around the world, and this will pause possible rate hikes.

“Commodity prices are the wild card here. Lower commodity prices reduce inflationary pressures and justify delaying monetary policy tightening. This helps keep policy rates lower for a bit longer, as inflationary pressures are not there to warrant a quicker increase,” World Bank senior economist Dr Frederico Gil Sander said.