Spotlight on OPR

       BANK Negara’s first monetary policy committee meeting of the year will be held this week.

       According to a Bloomberg poll, it is a unanimous call for no change to the overnight policy rate (OPR) at 1.75%. All 23 economists polled by Reuters expect the central bank to maintain the OPR.

       UOB Global Economics & Markets Research expects it to stand pat on OPR until mid-2022.

       It expects a 25 basis points rate hike to 2% in the third quarter of 2022.

       Meanwhile, the Statistics Department is expected to release the consumer price index for December 2021 on Friday.

       Bursa Malaysia Bhd and its subsidiaries (except for Labuan Exchange) will be closed tomorrow in conjunction with the Thaipusam Public Holiday.

       China Q4’21 GDP

       CHINA is expected to release its gross domestic product (GDP) for the fourth quarter (Q4)of 2021 along with industrial production and retail sales this week.

       The GDP growth in Q4 will be down compared with the previous quarter, due to defaults in real estate companies and some base effect, according to ING.

       It expects a slight uptrend in retail sales and fixed asset investments, as the job market has started to stabilise and the government has encouraged the start of infrastructure investments managed by local governments. China’s GDP likely expanded by 8% in 2021, according to the median forecasts of 62 economists polled by Reuters, slower than the 8.2% rise in October’s forecast but remained the highest annual growth in a decade.

       The poll showed economic growth was likely to slow to 5.2% in 2022, before steadying in 2023.

       Central bank meetings

       BANK Indonesia (BI) and the Bank of Japan (BoJ) will hold their first meeting of the year.

       ING does not expect any changes in terms of policy from BI’s governor Perry Warjiyo.

       The research house will be on the lookout for any change to his overall position for the year, after Warjiyo recently indicated he would be open to shifting to a “pro-stability” stance in 2022.

       The coming year will likely see inflation return to target, with both supply-side and demand-pull factors coming into play, according to the research house.