Kenanga expects Bank Negara to continue monetary tightening bias

KUALA LUMPUR: Bank Negara Malaysia (BNM) is likely to continue its monetary tightening bias until at least the first quarter of 2023, supported by the improvement in the Malaysian labour market and the country’s robust economic recovery, said Kenanga Investment Bank Bhd (Kenanga).

In a research note today, it said improved domestic labour market and economic recovery may compel BNM to raise the overnight policy rate (OPR) by another 25 basis points (bps) during its Monetary Policy Committee meeting today in an effort to preempt the build-up of demand-side inflationary pressure.