Bank Negara releases RM16b liquidity into banking system

KUALA LUMPUR: Banking institutions can use Malaysian Government Securities (MGS) and Malaysian Government Investment Issue (MGII) to meet the Statutory Reserve Requirement (SRR) compliance with effect from May 16.

Bank Negara Malaysia said on Tuesday this would release RM16bil worth of liquidity into the banking system. This flexibility is available until May 31,2021.

“The Statutory Reserve Requirement (SRR) ratio remains unchanged at 2%, ” it said.

It said the measure was part of its continuous efforts to ensure sufficient liquidity to support financial intermediation activity.

The SRR is an instrument to manage liquidity and is not a signal on the stance of monetary policy, it said.

Concurrently, Bank Negara's Monetary Policy Committee (MPC) slashed interest rates by 50 basis points to 2% which is the lowest level since 2010 as the domestic economic conditions have been affected by the Covid-19 pandemic.

The reduction of the Overnight Policy Rate (OPR) was within market expectations as the economy undergoes a contraction due to the Covid-19 pandemic that had had battered countries around the world.

The OPR is the sole indicator used to signal the stance of monetary policy.

Article type: metered
User Type: anonymous web
User Status:
Campaign ID: 46
Cxense type: free
User access status: 3

Bank Negara , SRR , MGS , MGII , OPR


Next In Business News

Redtone Digital appoints Jalil Rasheed as deputy chairman
FBM KLCI closes marginally higher
Bitcoin falls 7% as cryptos stumble over Biden tax plans
Taiwan's chip industry set for years of growth: minister
AirAsia partners RinggitPlus to set up one-stop financial marketplace
CPI up 1.7% to 122.9 in March 2021
Maxis records 1Q net profit of RM334mil, declares 4 sen/share div
Digi posts RM264.8mil earnings in 1Q, declares 3.4 sen dividend
AirAsia Group expects 'clarity' on fundraising in 2-3 months
Pertama Digital keen to apply for digital banking license

Stories You'll Enjoy