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Fixed Deposit Rates In Malaysia V. No.11, Strictly for FD Discussion Only
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gsc
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 Jan 27 2016, 12:06 AM
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QUOTE(cherroy @ Jan 26 2016, 02:41 PM) 1. It has nothing to do with interest rate. It is about bad personal financial management. 2. It has nothing to do with interest rate, as onset of GST that causing inflation is one off event. It is a cost push inflation, raising interest rate won't able to cool this kind of inflation. Interest rate will be effective to cool down demand pull inflation, which is not the case currently, as demand is slow currently. 3. It will drive BNM into more easing bias, aka lowering interest rate. So there is no case for interest rate to be hiked currently, only got potential rate cut if RM exchange rate become more stablise. We both monitor interest rate based on the economic activities within Malaysia and across the globe. Interest rate is every country central bank's weapon to tighten or loosen the money supply in the market. Yet members are waiting for the increase in rate just because a few banks offer higher rate for their own operations and strategic reasons. |
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gsc
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Jan 27 2016, 10:27 PM
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QUOTE(TOMEI-R @ Jan 26 2016, 10:52 AM) Yes, BNM will definately resort to lowering interest rates to boost local consumption to review the economy. But the issue is, how much can local consumption go around? The country's economy cant just demand on local consumption. This is only a short term effort by BNM which will not help much once there is not enough money to go around locally. Outflowing of funds slowing down because there are not much to 'outflow' anymore. Market is bad. Everybody needs to have money to run their business, pay their debts etc. Foreigners especially O&G sectors have long left the country and withdrawn their funds in Malaysia back to their own country. I dont agree loan demand will slow down. Malaysians, majority of them like to be in debt. Every persons needs a loan. Even for a handphone which costs a few hundred ringgit, they prefer to get an installment plan for it.  But the issues lies in the willingness of the Banks to give out loans. NPL is at all time high, more and more people are sued for bankruptcy everyday. Borrrowers are saddled with many loans and bad credit records all contribute to banks being very stringent in giving out loans. Interest rate is not the only way central bank can use to improve economy activities. There are other economic policies such as fiscal policy and supply side policy. You are correct, there is not much money flowing around. But still some economic measures need to be taken to avoid heading towards recession. Based on current scenario of dropping oil prices, slowng down in China economic and depreciation of RM, am still holding on to the belief that OPR will be lower in Q2 or Q3. Only time can tell who is right. |
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gsc
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Jan 29 2016, 02:04 AM
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Employee contribution to EPF will be dropped from 11% to 8%, confirming further Malaysia economy is slowing down. Lowering the contribution portion will directly increase the money supply in the market.....similar objective when BNM lowered the bank reserve ratio. If all these do not help to boost economy activity, BNM will likely look at the open market operation through selling of bonds...next will be reduction in OPR....but still there will be one to two banks offers promo rate for strategic and internal oeratioal reasons but the rate wont be that high anymore...
BSN recently has been unusually advertised in the TV media, last year second half unusually with banner advertisement and now promo rate of 4.5%. In my opinion this is their strategic move and does not reflect the FD rate trend in future.
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gsc
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Jan 30 2016, 12:36 AM
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Japan economic has hit recession about 2 quarter ago, the central bank of Japan planned to implement negative FD to boost the economy. US implemented QE during the World Financial Crisis and it took them close to 8 years (since 2008) to raise the interest rate recently.
Malaysia GDP projection for 2016 as usual projected higher by MIER to be 4+% but private analyst forecasted GDP to be 3+%. Next week will get to know Malaysia GDP in 2015. Weak ringgit, low oil prices, slowing down of China growth will affect BNM policy on the OPR.
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gsc
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Feb 2 2016, 01:41 AM
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QUOTE(Ramjade @ Feb 1 2016, 11:03 AM) Yes. For example banks kena rob, PIDM will cover some of the loss. As long don't exceed RM250k, you are safe (if you really care about getting the PIDM protection) Where did you get the info. bank kena rob, PIDM will cover the loss? PIDM cover the bank on robbery? |
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