Research Briefing | Mar 6, 2023

Asia Weekly Briefing: Lunar New Year adds noise and BNM likely to stay on hold

Asia Weekly Briefing: Lunar New Year adds noise and BNM likely to stay on hold

The first central bank in the region to pause rate hikes this year, Bank Negara Malaysia (BNM), is likely to remain on hold this Thursday. And in Japan, the Bank of Japan (BoJ) is likely to maintain its stance on Friday.

Inflation is likely to soften further in the coming months, following an easing of price pressures in the last third of 2022. But we may not see much sign of it in the February CPI data next week.

Easing pressure from inflation is likely to enable monetary policymakers to focus more on the increasingly downbeat growth outlook. We expect other central banks that have stopped hiking in recent weeks (South Korea and Indonesia) to also remain on hold throughout 2023.

The main risk to our view is if external pressures from monetary tightening in the US re-intensify. We now expect the Fed to hike three more times this cycle, by 25bps in March, May, and June.

Aside from Malaysia’s BNM meeting and a host of CPI data this week, the closely-watched “Two Sessions” political event will be held in China, trade data from China and Taiwan will be released, and Governor Haruhiko Kuroda will chair his last BoJ meeting.

Back to Resource Hub

Related Resouces

EV

Post

Rich in minerals, Indonesia dares to dream of an EV future

We believe Indonesia's strategy to move up the electric vehicle supply chain by restricting its mineral exports and inviting more investment should pay dividends for growth.

Find Out More

Post

CNA: Singapore could downgrade full-year economic forecast, says analyst

Alex Holmes, Senior Economist at Oxford Economics, joins CNA to discuss why Singapore’s 2023 growth forecast of 0.5 to 2.5% is “unrealistic”.

Find Out More

Post

BFM: Misplaced optimism in Asia’s economy

Alex Holmes, Senior Economist at Oxford Economics, joins  BFM 89.9 The Business Station to discuss misplaced optimism in Asia's economy.

Find Out More