Insight - Targeted fiscal support still needed

Lee Heng Guie SERC: A reduction in public sector demand would trigger a renewed contraction of the economy if the private sector has not recovered to take on as the growth’s driver seat. It’s not about only getting the right macro narrative; the impactful policies implementation must remain squarely in focus.

WITH the domestic economy at an early stage of recovery, albeit unevenly across sectors and businesses, accommodative monetary policy and fiscal support are incredibly important to ensure that the economic rebound and recovery will not turn anemic amid increasing concerns about an occurrence of a second wave of virus and the availability of vaccines.

Bank Negara’s monetary policy and liquidity measures are expected to remain in accommodative mode and will remain supportive in the foreseeable future.