OPR — How low can you go?

“The OPR is now at its historical low and further cuts may not be effective in stimulating demand. There are other ways the government can stimulate demand and spur the economy, ” Dr Yeah Kim Leng, (pic) a professor of economics at the Sunway University Business School, told StarBiz.

PETALING JAYA: A further relief for existing borrowers but a lack of bullets in the future; or creating unhealthy imbalances in the economy? These are the considerations Bank Negara will have to make when its monetary policy committee (MPC) meets today to decide whether to cut the overnight policy rate (OPR) further.

Continued cuts to the OPR or interest rates may not yield the desired effect on the real economy, according to economists.