Bank Negara to cut SRR to release more liquidity into banking system?

Malaysian Rating Corp Bhd (MARC) chief economist Nor Zahidi Alias told StarBiz that he expected further cuts in the SRR this year, possibly by another 50 to 100 bps to 2.5%-3%.

PETALING JAYA: Expectations are building up for Bank Negara to reduce the statutory reserve requirement (SRR) by between 50 and 100 basis points (bps) this year to release more liquidity into the banking system amidst the slowing economy.

This comes following the recent 25% bps cut in the overnight policy rate (OPR) that has caused a compression in the net interest margins (NIMs) of banks.

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