Malaysia holds key interest rate at 2pc
Malaysia's central bank kept its key interest rate at 2.0 percent Wednesday, saying the economy is expected to contract markedly in the first quarter of the year.
Bank Negara said poor global economic conditions were adversely affecting Malaysia's key exports and industrial production, in turn hitting the labour market and private sector activity.
"The economy, therefore, is expected to record a marked contraction in the first quarter of 2009 (in upcoming results). These conditions are expected to prevail until the second quarter of the year," it added.
However, the bank said it would not adjust the interest rate as the present monetary policy measures were "sufficient to provide support to domestic demand."
Bank Negara said the domestic economy was expected to improve in the second half of 2009, "supported by stabilisation in global economic conditions and the larger impetus from the implementation of the fiscal stimulus measures.”
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