Malaysia: More optimistic on growth - Nomura

Research Team at Nomura, notes that Malaysian policymakers seem more optimistic on the economic outlook, with BNM appearing comfortable with the current policy rate for now, although it still noted that there is policy space to ease if growth disappoints.

Key Quotes

“The official commitment to fiscal consolidation remains strong, with the government aiming to reduce the fiscal deficit to 3.0% of GDP in 2017 and to around 1.0% by 2020. We still expect an early general election to be called this year, but risks are rising that this will held later than our base case of Q2, given delays in the completion of the constituency delimitation exercise. Policymakers hinted that measures implemented in FX markets are here to stay, as they are viewed as medium-term positive.”