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24 Jul 2023 | International Reserves of Bank Negara Malaysia as at 14 July 2023 | https://www.bnm.gov.my/-/international-reserves-of-bank-negara-malaysia-as-at-14-july-2023 | https://www.bnm.gov.my/documents/20124/6118085/qb2021q4_en_box_imports.pdf | null |
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International Reserves of Bank Negara Malaysia as at 14 July 2023
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International Reserves of Bank Negara Malaysia as at 14 July 2023
Embargo :
For immediate release
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1500 on
Monday, 24 July 2023
24 Jul 2023
The international reserves of Bank Negara Malaysia amounted to USD111.8 billion as at 14 July 2023. The reserves position is sufficient to finance 5.1 months of imports of goods and services[1], and is 1.0 time of the total short-term external debt.
[1] Under the previous import coverage measure, reserves is sufficient to finance 7.0 months of retained imports of goods. For more information on the new indicator, please refer to the article on “Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to Imports of Goods and Services” in BNM’s Quarterly Bulletin for the Fourth Quarter of 2021 publication, page 27, which can be accessed at bnm.gov.my/-/quarterly-bulletin-4q-2021 Related Assets
BNM Statement of Assets & Liabilities - 14 July 2023
Bank Negara Malaysia
24 July 2023
© Bank Negara Malaysia, 2023. All rights reserved.
|
Monthly Highlights
Headline inflation declined to 3.4% in March
March 2023
1
3.7 3.4
3.9 3.8
0.00
2.00
4.00
0.0
2.0
4.0
J
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2
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Food & non-alcohol (29.5%) Housing & utilities (23.8%)
Transport (14.6%) Others (32.1%)
Headline inflation (RHS) Core inflation¹ (RHS)
Contribution to Inflation
ppt. contribution %, yoy
1 Core inflation is computed by excluding price-volatile and price-administered items.
Source: Department of Statistics, Malaysia & Bank Negara Malaysia estimates
• Headline inflation declined to 3.4% in March
(February: 3.7%) due mainly to lower inflation for
fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation moderated slightly to 3.8% during
the month (February: 3.9%), driven largely by
lower inflation for food away from home.
1
Robust growth in volume index driven by retail and motor vehicles
Index of Wholesale and Retail Trade
Source: Department of Statistics, Malaysia
• The Index of Wholesale and Retail Trade
(IOWRT) expanded by 10.6% in February 2023
(January: 8.5%).
• The higher growth was driven mainly by retail
sales in non-specialised stores (e.g., department
stores) followed by continued strength in
purchases of motor vehicles amid the ongoing
fulfilment of backlog orders.
• On a month-on-month seasonally adjusted basis,
the index accelerated by 5.5% (January: 0.2%).
9.5 8.510.6
0
10
20
30
40
Feb-
22
Mar-
22
Apr-
22
May-
22
Jun-
22
Jul-
22
Aug-
22
Sep-
22
Oct-
22
Nov-
22
Dec-
22
Jan-
23
Feb-
23
ppt, %yoy
Motor vehicles Retail Wholesale
2.4
5.2
4.4
0
1
2
3
4
5
6
7
Mar-22 Jul-22 Nov-22 Mar-23
Business loans
Household loans
Corporate bonds
Annual growth (%)
Growth in credit to the private non-financial sector moderated
1 Comprises loans to households and non-financial corporations from the
banking system and development financial institutions (DFIs), and corporate
bonds issued by non-financial corporations (including short-term papers).
2 Starting with the publication of December 2022 Monthly Highlights and
Statistics (MHS), this series was introduced to enhance the quality of
financing data. This new data series is available in the MHS Table 2.18.
Source: Bank Negara Malaysia
2.7 2.6 2.7 2.6
1.0 0.6 0.7 0.7
1.0
1.1 1.1 0.9
4.7 4.3 4.5 4.2
Dec-22 Jan-23 Feb-23 Mar-23
Corporate Bonds
Business Loans
Household Loans
Credit to the Private Non-
Financial Sector
Contribution to growth (ppt)
• Credit to the private non-financial sector grew by
4.2% as at end-March (February: 4.5%), attributed
to slower growth in credit to businesses (3.2%;
February: 3.7%).
• While growth in outstanding corporate bonds
moderated (4.4%; February : 5.5%), outstanding
business loan growth was sustained at 2.4%
(February: 2.4%). This was supported by the
continued growth in both working capital (2.2%;
February: 1.9%) and investment-related loans
(4.3%; February: 4.2%).
• Outstanding household loan growth remained
broadly stable (5.2%; February: 5.3%), supported
by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan
growth for the purchase of securities (-6.9%;
February: -3.3%).
Credit to the Private Non-Financial Sector1,2
Monthly Highlights
March 2023
Domestic financial market conditions remained orderly
Financial Market Performance in March 2023
Source: Bank Negara Malaysia, Bursa Malaysia
Note: The exchange rate data is the noon-rate in the Kuala Lumpur Interbank Foreign Exchange Market
11.0
-2.1
-5.3
0.0
-2.2
1.7
10-year MGS
(bps, mom)
Equity
(%, mom)
Ringgit
(%, mom)
-10 -5 0 5 10 15
Mar-23
Feb-23
• In March, global financial markets were affected by
the emergence of banking sector stress in some
major economies. As spillovers were contained thus
far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds
improved.
• In line with the performance of regional currencies,
the ringgit appreciated by 1.7% against the US
dollar. Conditions in the domestic bond market
also remained stable.
• The FBM KLCI declined by 2.2% during the month.
2
Banks maintained strong liquidity and funding positions to support intermediation
Source: Bank Negara Malaysia
Banking System Liquidity and Funding Ratios
81.9
157.4
0
40
80
120
160
70
75
80
85
90
95
M
a
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2
2
A
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M
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F
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3
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2
3
% %
Liquidity Coverage Ratio (RHS)
Loan-to-Fund Ratio
Asset quality in the banking system remained intact
Banking System Asset Quality
Source: Bank Negara Malaysia
• Overall gross and net impaired loans ratios
increased slightly to 1.8% (February-23: 1.8%) and
1.2% (February-23: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory
reserves) continue to record a prudent level of
110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
%
1.8
1.2
1.7
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
M
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3
M
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2
3
Gross Impaired Loans Ratio
Total Provisions to Total Loans Ratio
Net Impaired Loans Ratio
• Banks continued to record healthy liquidity buffers
with the aggregate Liquidity Coverage Ratio at
157.4% (February-23: 152.7%).
• The aggregate loan-to-fund ratio remained stable at
81.9% (February-23: 81.6%).
PRESS RELEASE
Ref. No.: 04/23/05 EMBARGO: Not for publication or
broadcast before 1500 hours on
Friday, 28 April 2023
Monthly Highlights – March 2023
Headline inflation declined to 3.4% in March
• Headline inflation declined to 3.4% in March (February: 3.7%) due mainly
to lower inflation for fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation1 moderated slightly to 3.8% during the month
(February: 3.9%), driven largely by lower inflation for food away from
home.
Robust growth in volume index driven by retail and motor vehicles
• The Index of Wholesale and Retail Trade (IOWRT) expanded by 10.6%
in February 2023 (January: 8.5%).
• The higher growth was driven mainly by retail sales in non-specialised
stores (e.g., department stores) followed by continued strength in
purchases of motor vehicles amid the ongoing fulfilment of backlog
orders.
• On a month-on-month seasonally adjusted basis, the index accelerated
by 5.5% (January: 0.2%).
1 Core inflation is computed by excluding price-volatile and price-administered items.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Growth in credit to the private non-financial sector2,3 moderated
• Credit to the private non-financial sector grew by 4.2% as at end-March
(February: 4.5%), attributed to slower growth in credit to businesses
(3.2%; February: 3.7%).
• While growth in outstanding corporate bonds moderated (4.4%;
February: 5.5%), outstanding business loan growth was sustained at
2.4% (February: 2.4%). This was supported by the continued growth in
both working capital (2.2%; February: 1.9%) and investment-related
loans (4.3%; February: 4.2%).
• Outstanding household loan growth remained broadly stable (5.2%;
February: 5.3%), supported by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan growth for the purchase of
securities (-6.9%; February: -3.3%).
Domestic financial market conditions remained orderly
• In March, global financial markets were affected by the emergence of
banking sector stress in some major economies. As spillovers were
contained thus far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds improved.
• In line with the performance of regional currencies, the ringgit
appreciated by 1.7% against the US dollar. Conditions in the domestic
bond market also remained stable.
• The FBM KLCI declined by 2.2% during the month.
Banks maintained strong liquidity and funding positions to support
intermediation
• Banks continued to record healthy liquidity buffers with the aggregate
Liquidity Coverage Ratio at 157.4% (February: 152.7%).
2 Comprises loans to households and non-financial corporations from the banking system and development financial
institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers).
3 Starting with the publication of December 2022 Monthly Highlights and Statistics (MHS), this series was introduced
to enhance the quality of financing data. This new data series is available in the MHS Table 2.18.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
• The aggregate loan-to-fund ratio remained stable at 81.9%
(February: 81.6%).
Asset quality in the banking system remained intact
• Overall gross and net impaired loans ratios increased slightly to 1.8%
(February: 1.8%) and 1.2% (February: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory reserves) continues to
record a prudent level of 110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
Bank Negara Malaysia
28 April 2023
20230428_BNM Monthly Highlights-March_en
Slide 1
Slide 2
20230428_BNM PR_Monthly Highlights-Mar 2023_eng
| Press Release |
10 Jul 2023 | Winners of the AML/CFT Hackathon 2023 | https://www.bnm.gov.my/-/winners-amlcft-hackathon-23 | null | null |
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Winners of the AML/CFT Hackathon 2023
Share:
5
Winners of the AML/CFT Hackathon 2023
Embargo :
For immediate release
Not for publication or broadcast before
1644 on
Monday, 10 July 2023
10 Jul 2023
Bank Negara Malaysia (BNM) today announced the winners of the Anti-Money Laundering/Counter Financing of Terrorism Hackathon 2023. The Hackathon, which was launched in April 2023, has attracted over 660 participants from 140 teams, representing more than 20 countries from the Asia-Pacific region. Participants comprising regulatory bodies, law enforcement agencies, financial institutions, private entities and undergraduate students competed to develop prototypes of innovative digital tools to combat financial crimes. During the Hackathon, workshops coupled with mentoring sessions by 30 technology and AML/CFT experts were conducted to guide, equip and motivate the participants.
The winners of AML/CFT Hackathon 2023 are:
Public Sector
Private Sector
Open Category
Champion
Verifier (Australia)
RMATES (Malaysia)
KoderX (Singapore)
1st runner-up
CBI India (India)
The Interns (Malaysia)
H7N (Brazil)
2nd runner-up
TrackAML (Indonesia)
Currypuff (Malaysia)
MATA (Malaysia)
The champions for each category received cash prizes of USD5,000. They will also have the opportunity to present their winning prototype to the heads of delegates of Financial Intelligence Units at the upcoming Financial Intelligence Consultative Group (FICG[1]) meeting in July.
The winning prototypes stood out for their creativity. Verifier FIX by Verifier is a platform that allows banks to exchange insights about their customer’s level of financial crime risks, while preserving privacy. OmniQuest by RMATES observes patterns and anomalies from the digital footprint of mobile devices, to detect suspicious activities such as irregular timing and locations of transactions on a real-time basis. SentinelGuard by KoderX aims to reduce malware and impersonation attacks, by streamlining communication services between banks and end-users, leveraging on an end-to-end encryption mechanism platform. The judges comprised industry experts from Malaysia, Australia, Indonesia, New Zealand and the United States.
Bank Negara Malaysia Deputy Governor Dato’ Marzunisham Omar said, “The winners’ prototypes illustrate that we can indeed outsmart financial crimes with innovative solutions. The important task ahead is to convert these prototypes into real digital tools. I call on financial institutions and regulatory bodies, as well as law enforcement agencies, to explore these digital tools, so that together we can effectively combat financial crimes.”
BNM congratulates the winners and thanks all the stakeholders, including the judges, mentors and participants for their commitment and collaborative efforts in making the event a success. A recording of the closing event is available on the AML Hackathon 2023 Facebook page at facebook.com/amlhackathon.
Winners of AML/CFT Hackathon 2023 with Assistant Governor Abd. Rahman Abu Bakar (standing seventh from right).
[1] The FICG is a regional body, comprising ASEAN, New Zealand and Australia, aimed at promoting, enhancing and strengthening collaboration to combat financial crimes.
Bank Negara Malaysia
10 July 2023
© Bank Negara Malaysia, 2023. All rights reserved.
| null | Press Release |
07 Jul 2023 | International Reserves of Bank Negara Malaysia as at 30 June 2023 | https://www.bnm.gov.my/-/international-reserves-of-bank-negara-malaysia-as-at-30-june-2023 | https://www.bnm.gov.my/documents/20124/6118085/qb2021q4_en_box_imports.pdf | null |
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International Reserves of Bank Negara Malaysia as at 30 June 2023
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10
International Reserves of Bank Negara Malaysia as at 30 June 2023
Embargo :
For immediate release
Not for publication or broadcast before
1500 on
Friday, 7 July 2023
7 Jul 2023
The international reserves of Bank Negara Malaysia amounted to USD111.4 billion as at 30 June 2023. The reserves level has taken into account the quarterly foreign exchange revaluation changes. The reserves position is sufficient to finance 5.0 months of imports of goods and services[1], and is 1.0 time the total short-term external debt.
[1] Under the previous import coverage measure, reserves is sufficient to finance 6.7 months of retained imports of goods. For more information on the new indicator, please refer to the article on “Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to Imports of Goods and Services” in BNM’s Quarterly Bulletin for the Fourth Quarter of 2021 publication, page 27, which can be accessed at Quarterly Bulletin 4Q2021. Related Assets
BNM Statement of Assets & Liabilities - 30 June 2023
Bank Negara Malaysia
7 July 2023
© Bank Negara Malaysia, 2023. All rights reserved.
|
Monthly Highlights
Headline inflation declined to 3.4% in March
March 2023
1
3.7 3.4
3.9 3.8
0.00
2.00
4.00
0.0
2.0
4.0
J
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2
F
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2
J
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2
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Food & non-alcohol (29.5%) Housing & utilities (23.8%)
Transport (14.6%) Others (32.1%)
Headline inflation (RHS) Core inflation¹ (RHS)
Contribution to Inflation
ppt. contribution %, yoy
1 Core inflation is computed by excluding price-volatile and price-administered items.
Source: Department of Statistics, Malaysia & Bank Negara Malaysia estimates
• Headline inflation declined to 3.4% in March
(February: 3.7%) due mainly to lower inflation for
fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation moderated slightly to 3.8% during
the month (February: 3.9%), driven largely by
lower inflation for food away from home.
1
Robust growth in volume index driven by retail and motor vehicles
Index of Wholesale and Retail Trade
Source: Department of Statistics, Malaysia
• The Index of Wholesale and Retail Trade
(IOWRT) expanded by 10.6% in February 2023
(January: 8.5%).
• The higher growth was driven mainly by retail
sales in non-specialised stores (e.g., department
stores) followed by continued strength in
purchases of motor vehicles amid the ongoing
fulfilment of backlog orders.
• On a month-on-month seasonally adjusted basis,
the index accelerated by 5.5% (January: 0.2%).
9.5 8.510.6
0
10
20
30
40
Feb-
22
Mar-
22
Apr-
22
May-
22
Jun-
22
Jul-
22
Aug-
22
Sep-
22
Oct-
22
Nov-
22
Dec-
22
Jan-
23
Feb-
23
ppt, %yoy
Motor vehicles Retail Wholesale
2.4
5.2
4.4
0
1
2
3
4
5
6
7
Mar-22 Jul-22 Nov-22 Mar-23
Business loans
Household loans
Corporate bonds
Annual growth (%)
Growth in credit to the private non-financial sector moderated
1 Comprises loans to households and non-financial corporations from the
banking system and development financial institutions (DFIs), and corporate
bonds issued by non-financial corporations (including short-term papers).
2 Starting with the publication of December 2022 Monthly Highlights and
Statistics (MHS), this series was introduced to enhance the quality of
financing data. This new data series is available in the MHS Table 2.18.
Source: Bank Negara Malaysia
2.7 2.6 2.7 2.6
1.0 0.6 0.7 0.7
1.0
1.1 1.1 0.9
4.7 4.3 4.5 4.2
Dec-22 Jan-23 Feb-23 Mar-23
Corporate Bonds
Business Loans
Household Loans
Credit to the Private Non-
Financial Sector
Contribution to growth (ppt)
• Credit to the private non-financial sector grew by
4.2% as at end-March (February: 4.5%), attributed
to slower growth in credit to businesses (3.2%;
February: 3.7%).
• While growth in outstanding corporate bonds
moderated (4.4%; February : 5.5%), outstanding
business loan growth was sustained at 2.4%
(February: 2.4%). This was supported by the
continued growth in both working capital (2.2%;
February: 1.9%) and investment-related loans
(4.3%; February: 4.2%).
• Outstanding household loan growth remained
broadly stable (5.2%; February: 5.3%), supported
by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan
growth for the purchase of securities (-6.9%;
February: -3.3%).
Credit to the Private Non-Financial Sector1,2
Monthly Highlights
March 2023
Domestic financial market conditions remained orderly
Financial Market Performance in March 2023
Source: Bank Negara Malaysia, Bursa Malaysia
Note: The exchange rate data is the noon-rate in the Kuala Lumpur Interbank Foreign Exchange Market
11.0
-2.1
-5.3
0.0
-2.2
1.7
10-year MGS
(bps, mom)
Equity
(%, mom)
Ringgit
(%, mom)
-10 -5 0 5 10 15
Mar-23
Feb-23
• In March, global financial markets were affected by
the emergence of banking sector stress in some
major economies. As spillovers were contained thus
far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds
improved.
• In line with the performance of regional currencies,
the ringgit appreciated by 1.7% against the US
dollar. Conditions in the domestic bond market
also remained stable.
• The FBM KLCI declined by 2.2% during the month.
2
Banks maintained strong liquidity and funding positions to support intermediation
Source: Bank Negara Malaysia
Banking System Liquidity and Funding Ratios
81.9
157.4
0
40
80
120
160
70
75
80
85
90
95
M
a
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2
2
A
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2
2
M
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2
2
J
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2
J
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2
A
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2
2
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2
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2
2
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2
D
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c
2
2
J
a
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2
3
F
e
b
2
3
M
a
r
2
3
% %
Liquidity Coverage Ratio (RHS)
Loan-to-Fund Ratio
Asset quality in the banking system remained intact
Banking System Asset Quality
Source: Bank Negara Malaysia
• Overall gross and net impaired loans ratios
increased slightly to 1.8% (February-23: 1.8%) and
1.2% (February-23: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory
reserves) continue to record a prudent level of
110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
%
1.8
1.2
1.7
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
M
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3
F
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2
3
M
a
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2
3
Gross Impaired Loans Ratio
Total Provisions to Total Loans Ratio
Net Impaired Loans Ratio
• Banks continued to record healthy liquidity buffers
with the aggregate Liquidity Coverage Ratio at
157.4% (February-23: 152.7%).
• The aggregate loan-to-fund ratio remained stable at
81.9% (February-23: 81.6%).
PRESS RELEASE
Ref. No.: 04/23/05 EMBARGO: Not for publication or
broadcast before 1500 hours on
Friday, 28 April 2023
Monthly Highlights – March 2023
Headline inflation declined to 3.4% in March
• Headline inflation declined to 3.4% in March (February: 3.7%) due mainly
to lower inflation for fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation1 moderated slightly to 3.8% during the month
(February: 3.9%), driven largely by lower inflation for food away from
home.
Robust growth in volume index driven by retail and motor vehicles
• The Index of Wholesale and Retail Trade (IOWRT) expanded by 10.6%
in February 2023 (January: 8.5%).
• The higher growth was driven mainly by retail sales in non-specialised
stores (e.g., department stores) followed by continued strength in
purchases of motor vehicles amid the ongoing fulfilment of backlog
orders.
• On a month-on-month seasonally adjusted basis, the index accelerated
by 5.5% (January: 0.2%).
1 Core inflation is computed by excluding price-volatile and price-administered items.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Growth in credit to the private non-financial sector2,3 moderated
• Credit to the private non-financial sector grew by 4.2% as at end-March
(February: 4.5%), attributed to slower growth in credit to businesses
(3.2%; February: 3.7%).
• While growth in outstanding corporate bonds moderated (4.4%;
February: 5.5%), outstanding business loan growth was sustained at
2.4% (February: 2.4%). This was supported by the continued growth in
both working capital (2.2%; February: 1.9%) and investment-related
loans (4.3%; February: 4.2%).
• Outstanding household loan growth remained broadly stable (5.2%;
February: 5.3%), supported by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan growth for the purchase of
securities (-6.9%; February: -3.3%).
Domestic financial market conditions remained orderly
• In March, global financial markets were affected by the emergence of
banking sector stress in some major economies. As spillovers were
contained thus far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds improved.
• In line with the performance of regional currencies, the ringgit
appreciated by 1.7% against the US dollar. Conditions in the domestic
bond market also remained stable.
• The FBM KLCI declined by 2.2% during the month.
Banks maintained strong liquidity and funding positions to support
intermediation
• Banks continued to record healthy liquidity buffers with the aggregate
Liquidity Coverage Ratio at 157.4% (February: 152.7%).
2 Comprises loans to households and non-financial corporations from the banking system and development financial
institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers).
3 Starting with the publication of December 2022 Monthly Highlights and Statistics (MHS), this series was introduced
to enhance the quality of financing data. This new data series is available in the MHS Table 2.18.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
• The aggregate loan-to-fund ratio remained stable at 81.9%
(February: 81.6%).
Asset quality in the banking system remained intact
• Overall gross and net impaired loans ratios increased slightly to 1.8%
(February: 1.8%) and 1.2% (February: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory reserves) continues to
record a prudent level of 110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
Bank Negara Malaysia
28 April 2023
20230428_BNM Monthly Highlights-March_en
Slide 1
Slide 2
20230428_BNM PR_Monthly Highlights-Mar 2023_eng
| Press Release |
06 Jul 2023 | Monetary Policy Statement | https://www.bnm.gov.my/-/monetary-policy-statement-06072023 | https://www.bnm.gov.my/documents/20124/11193514/MPS_Snapshot_2023_07_en.pdf | null |
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Monetary Policy Statement
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Monetary Policy Statement
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1500 on
Thursday, 6 July 2023
6 Jul 2023
At its meeting today, the Monetary Policy Committee (MPC) of Bank Negara Malaysia decided to maintain the Overnight Policy Rate (OPR) at 3.00 percent.
The global economy continues to expand, driven by resilient domestic demand supported by strong labour market conditions. Global growth, however, remains weighed down by persistent core inflation and higher interest rates. While China’s reopening remains supportive of the global economy, its pace of recovery has slowed in recent months. Globally, headline inflation continued to moderate, but core inflation remains above historical averages. For most central banks, the monetary policy stance is likely to remain tight. The growth outlook remains subject to downside risks, mainly from a slower momentum in major economies, higher-than-anticipated inflation outturns, an escalation of geopolitical tensions, and a sharp tightening in financial market conditions.
Following a strong outturn in the first quarter of the year, the Malaysian economy expanded at a more moderate pace in recent months as exports were weighed down by slower external demand, as expected. Growth for the remainder of the year will continue to be driven by resilient domestic demand. Household spending continues to be underpinned by favourable labour market conditions, particularly in the domestic-oriented sectors. Tourist arrivals have been steadily improving, and are expected to continue rising, thereby lifting tourism-related activities. Investment activity would be supported by continued progress of multi-year infrastructure projects. Domestic financial conditions also remain conducive to financial intermediation amid sustained credit growth. While the growth outlook is subject to some downside risks stemming from weaker-than-expected global growth, upside risks mainly emanate from domestic factors such as stronger-than-expected tourism activity and faster implementation of projects.
Headline inflation has continued to ease amid lower cost factors. While core inflation has also moderated, it remains elevated relative to the long-term average amid lingering demand and cost factors. For the second half of 2023, both headline and core inflation are projected to trend lower, broadly within expectations. Risks to the inflation outlook remain highly subject to the degree of persistence in core inflation, changes to domestic policy on subsidies and price controls, as well as global commodity prices and financial market developments.
At the current OPR level, the monetary policy stance is slightly accommodative and remains supportive of the economy. The MPC continues to see limited risks of future financial imbalances. The MPC remains vigilant to ongoing developments, and will continue to monitor incoming data to inform the assessment on the outlook of domestic inflation and growth. The MPC will ensure that the monetary policy stance remains conducive to sustainable economic growth amid price stability.
See also:
Monetary Policy Statement (MPS) Snapshot: July 2023
Frequently Asked QuestionsBank Negara Malaysia
6 July 2023
© Bank Negara Malaysia, 2023. All rights reserved.
|
Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to Imports of Goods and Services
27Quarterly Bulletin | 4Q 2021
Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to
Imports of Goods and Services
One of the indicators used by the Bank to measure international reserve adequacy is the reserve coverage
of retained imports,1 which is communicated on a fortnightly basis. As the economy grew and evolved with
higher share of the services sector, this has raised the prominence of services imports in the measure of
reserve adequacy. Given this consideration and in line with the international best practice, future fortnightly
reporting of Malaysia’s international reserves will include the indicator on reserve coverage of imports of
goods and services, effective from 22 February 2022.2
1 Defined as gross imports subtracted with re-exports. The 12-month average retained imports can be derived from the Monthly Highlight and Statistics Table
3.6.8 (Imports by End-Use; see Appendix 1).
2 For the international reserves position as at 15 February 2022.
3 Defined as imports plus exports.
4 From RM101.3 billion to RM351.3 billion, or a compound annual growth rate (CAGR) of 6.4%.
5 Based on JP Morgan’s Government Bond Index for Emerging Markets.
Services tradeC1
0
100
200
300
400
1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021
RM billion
Travel1
Computer and information
Transport
Manufacturing
Other business3
Other2
Perdagangan perkhidmatanR1
0
100
200
300
400
1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021
RM bilion
Perjalanan1
Komputer dan informasi
Pengangkutan
Pembuatan
Perniagaan Lain3
Lain-lain2
Nota: Data sebelum tahun 2005 adalah berdasarkan garis panduan dalam Edisi Kelima Manual Imbangan Pembayaran dan Kedudukan
............Pelaburan Antarabangsa (BPM5) IMF. Data bagi tahun 2005 dan selanjutnya adalah berdasarkan BPM6.
1 Termasuk perbelanjaan perjalanan bagi aktiviti pelancongan.
2 Termasuk pembinaan, caj penggunaan harta intelek, perkhidmatan persendirian, kebudayaan dan rekreasi.
3 Perkhidmatan perniagaan lain termasuk perkhidmatan penyelidikan dan pembangunan, profesional, teknikal, berkaitan perdagangan dan
...perkhidmatan perniagaan lain.
Sumber: Jabatan Perangkaan Malaysia dan Bank Negara Malaysia
Note: Data prior to 2005 are based on the guideline in the Fifth Edition of the Balance of Payments and International Investment Position
............Manual (BPM5) of the IMF. Data for 2005 and beyond are based on BPM6.
1 Includes travel spending for tourism activity.
2 Includes construction, charges for intellectual property use, personal, culture & recreational services.
3 Other business services comprise research and development, professional, technical, trade-related and other business services.
Source: Department of Statistics, Malaysia and Bank Negara Malaysia
The Bank’s reporting of the reserve coverage of retained imports was published as early as in the 1990s. Data
on retained imports are available on monthly basis and thereby closely match the fortnightly release of the
international reserves data. However, retained imports do not include payment for services, which has grown
over the past two decades. From 1999 to 2019, services trade3 has increased by 246.9%4 (Chart 1). This was
mainly due to higher tourism activity as well as payments for foreign transport services for goods trade. In
addition, there was also an expansion in goods import, largely in support of domestic investment activities
and production of manufactured goods.
Malaysia’s performance on this indicator is in line with regional and peer5 economies. On historical basis,
reserve coverage of imports of goods and services indicator has been in the range of between 5 and 8
months since 2008 – well above the generally-accepted ‘rule of thumb’ adequacy threshold of 3-months, and
demonstrates the ability of the Malaysian economy to withstand against external shocks.
28 Quarterly Bulletin | 4Q 2021
It is also important to emphasize that the assessment of reserve adequacy should not be solely based
on the face value of these indicators. This needs to be complemented with deeper understanding about
the country’s external position, financial system and broad economic policies. In particular, international
reserves is not the only means to meet external obligations.6 Prevailing assessment indicates that the
country’s external position7 is underpinned by its strong economic fundamentals including healthy current
account surplus, large foreign currency external assets held by domestic entities8 and the flexible ringgit
exchange rate.
References
Department of Statistics, Malaysia. ‘External Sector’, Jabatan Perangkaan Malaysia, Putrajaya.
Greenspan, A., ‘Currency reserves and debt’. Remarks before the World Bank Conference on Recent Trends in
Reserves Management, Washington, DC, 29 April 1999.
International Monetary Fund, (2016). ‘Guidance Note on the Assessment of Reserve Adequacy and Related
Considerations’.
Appendix 1: Calculation of international reserves coverage of retained imports
aFor example, to calculate monthly retained imports for December 2019, the retained imports for the months of
January to December 2019 is summed up (i.e. rolling 12-months of retained imports). This number is then divided
by 12, to obtain a monthly average. The figures can be obtained from BNM’s MHS Table 3.6.8, column S.
6 Further information can be found in the box article “Malaysia’s Resilience in Managing External Debt Obligations and the Adequacy of International Reserves”
in BNM’s Annual Report 2018.
7 In addition, it has also been emphasized that Malaysia’s external debt position, including short-term external debt, remains manageable. This is supported by
the favourable currency and maturity profile on its external debt as well as domestic entities’ resilient repayment capacity. Foreign-currency external debt of
corporates are also mainly subject to prudential and hedging requirements (refer to the latest assessment on external debt developments on page 25)
8 Amounting to RM1.1 trillion as at end-2021.
| Press Release |
30 Jun 2023 | Monetary and Financial Developments in May 2023 | https://www.bnm.gov.my/-/monetary-and-financial-developments-in-may-2023-1 | https://www.bnm.gov.my/documents/20124/11137445/i_en.pdf | null |
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Monetary and Financial Developments in May 2023
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Monetary and Financial Developments in May 2023
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1500 on
Friday, 30 June 2023
30 Jun 2023
Headline inflation declined further to 2.8% in May
Headline inflation moderated to 2.8% (April 2023: 3.3%). This decline was largely due to non-core CPI components, particularly lower inflation for fuel (-0.2 percentage points, ppt) and fresh food (-0.1 ppt).
Core inflation[1] also declined slightly to 3.5% (April 2023: 3.6%) amid lower inflation for communication services.
Index of Wholesale and Retail Trade growth moderated in April
The Index of Wholesale and Retail Trade (IOWRT) expanded more moderately by 4.7% in April 2023 (March 2023: 9.4%). The lower growth was due mainly to the decline in the motor vehicle segment.
However, the retail segment continued to record a double-digit growth of 10.0% (March 2023: 13.8%), supported by sales in non-specialised and other specialised stores[2].
On a month-on-month seasonally-adjusted basis, the index increased at a faster pace of 6.5% (March 2023: -0.9%).
Growth in credit to the private non-financial sector[3],[4] improved in May
Credit to the private non-financial sector expanded by 4.0% as at end-May (April 2023: 3.7%), driven mainly by higher growth in credit to businesses (2.8%; April 2023: 2.5%).
Outstanding corporate bonds grew by 6% (April 2023: 4.4%), while outstanding business loans expanded by 1.6% (April 2023: 1.0%). The higher business loan growth reflected improvement in loans for both working capital and investments to SMEs and non-SMEs.
In the household segment, outstanding loan growth was sustained at1% (April 2023: 5.0%), supported by higher growth across most loan purposes. Of note, household loan growth continued to be driven by loans for the purchase of houses and cars, which grew by 7.0% and 8.4%, respectively (April 2023: 6.8% and 8.0%).
Domestic financial markets were largely affected by external factors
Global investors maintained a risk-off approach throughout May, as concerns over the impact of the US debt ceiling crisis and the weaker-than-expected rebound in China’s economy weighed on global financial markets.
As a result, the ringgit depreciated against the US dollar by 3.4% (regional[5] average: -1.2%). Similarly, the FBM KLCI declined by 2.0% (regional5 average: -1.3%).
Nonetheless, the 10-year MGS yields decreased slightly by 3 basis points, supported by non-resident inflows into the domestic bond market.
Banks maintained strong liquidity and funding positions to support intermediation
Banks continued to record healthy liquidity buffers with the aggregate Liquidity Coverage Ratio at 151.2% (April 2023: 154.3%).
The aggregate loan-to-fund ratio remained stable at 81.8% (April 2023: 82.1%).
Asset quality in the banking system remained intact
Overall gross and net impaired loans ratios remained broadly unchanged at 1.80% (April 2023: 1.78%) and 1.10% (April 2023: 1.10%), respectively.
Loan loss coverage ratio (including regulatory reserves) remained at a prudent level of 114.1% of impaired loans, with total provisions accounting for 1.7% of total loans.
See also: Monthly Highlights [PDF]
[1] Core inflation is computed by excluding price-volatile and price-administered items.
[2] Other goods in specialised stores includes clothing, footwear, pharmaceuticals, cosmetics, watches, jewellery and optical goods.
[3] Comprises loans to households and non-financial corporations from the banking system and development financial institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers).
[4] Starting with the publication of December 2022 Monthly Highlights and Statistics (MHS), this series was introduced to enhance the quality of financing data. This new data series is available in the MHS Table 2.18.
[5] Regional countries comprise Singapore, Thailand, Philippines, Indonesia, and Korea.
Related Assets
Monthly Highlights & Statistics in May 2023
Bank Negara Malaysia
30 June 2023
© Bank Negara Malaysia, 2023. All rights reserved.
|
Monthly Highlights May 2023
Monthly Highlights
Headline inflation declined further to 2.8% in May
May 2023
Contribution to Inflation
ppt. contribution %, yoy
1 Core inflation is computed by excluding price-volatile and price-administered items.
Source: Department of Statistics, Malaysia & Bank Negara Malaysia estimates
• Headline inflation moderated to 2.8% (April 2023:
3.3%). This decline was largely due to non-core
CPI components, particularly lower inflation for
fuel (-0.2 percentage points, ppt) and fresh food
(-0.1ppt).
• Core inflation also declined slightly to 3.5% (April
2023: 3.6%) amid lower inflation for
communication services.
3.3
2.8
3.6 3.5
0.00
2.00
4.00
0.0
2.0
4.0
J
a
n
-2
2
F
e
b
-2
2
M
a
r-
2
2
A
p
r-
2
2
M
a
y
-2
2
J
u
n
-2
2
J
u
l-
2
2
A
u
g
-2
2
S
e
p
-2
2
O
c
t-
2
2
N
o
v
-2
2
D
e
c
-2
2
J
a
n
-2
3
F
e
b
-2
3
M
a
r-
2
3
A
p
r-
2
3
M
a
y
-2
3
Food & non-alcohol (29.5%) Housing & utilities (23.8%)
Transport (14.6%) Others (32.1%)
Headline inflation (RHS) Core inflation¹ (RHS)
1.6
5.1
4.6
0
1
2
3
4
5
6
7
May-22 Sep-22 Jan-23 May-23
Business loans
Household loans
Corporate bonds
Annual growth (%)
Credit to the Private Non-Financial Sector1,2
1
Growth in credit to the private non-financial sector improved in May
1 Comprises loans to households and non-financial corporations from the
banking system and development financial institutions (DFIs), and corporate
bonds issued by non-financial corporations (including short-term papers).
2 Starting with the publication of December 2022 Monthly Highlights and
Statistics (MHS), this series was introduced to enhance the quality of
financing data. This new data series is available in the MHS Table 2.18.
Source: Bank Negara Malaysia
Contribution to growth (ppt)
• Credit to the private non-financial sector expanded
by 4.0% as at end-May (April 2023: 3.7%), driven
mainly by higher growth in credit to businesses
(2.8%; April 2023: 2.5%).
• Outstanding corporate bonds grew by 4.6% (April
2023: 4.4%), while outstanding business loans
expanded by 1.6% (April 2023: 1.0%). The higher
business loan growth reflected improvement in
loans for both working capital and investments to
SMEs and non-SMEs.
• In the household segment, outstanding loan
growth was sustained at 5.1% (April 2023: 5.0%),
supported by higher growth across most loan
purposes. Of note, household loan growth
continued to be driven by loans for the purchase of
houses and cars, which grew by 7.0% and 8.4%,
respectively (April 2023: 6.8% and 8.0%).
2.7 2.6 2.5 2.6
0.7 0.7 0.3 0.5
1.1 0.9
0.9 1.0
4.5 4.2
3.7 4.0
Feb-23 Mar-23 Apr-23 May-23
Corporate Bonds
Business Loans
Household Loans
Credit to the Private Non-
Financial Sector
Index of wholesale and retail trade growth moderated in April
Source: Department of Statistics, Malaysia
• The Index of Wholesale and Retail Trade
(IOWRT) expanded more moderately by 4.7% in
April 2023 (March 2023: 9.4%). The lower growth
was due mainly to the decline in the motor vehicle
segment.
• However, the retail segment continued to record a
double-digit growth of 10.0% (March 2023:
13.8%), supported by sales in non-specialised and
other specialised stores1.
• On a month-on-month seasonally adjusted basis,
the index increased at a faster pace of 6.5%
(March 2023: -0.9%).
1 Other goods in specialised stores includes clothing, footwear,
pharmaceuticals, cosmetics, watches, jewellery and optical goods.
10.6
9.4
4.7
-2
3
8
13
18
23
28
33
Apr-22 Jun-22 Aug-22 Oct-22 Dec-22 Feb-23 Apr-23
ppt, %yoy
Motor vehicles Retail Wholesale
Index of Wholesale and Retail Trade
Monthly Highlights
2
May 2023
Domestic financial markets were largely affected by external factors
Financial Market Performance in May 2023
-18.0
-0.5
-1.1
-3.0
-2.0
-3.4
10-year MGS
(bps, mom)
Equity
(%, mom)
Ringgit
(%, mom)
-20 -15 -10 -5 0
May-23 Apr-23
Note: The exchange rate data is the noon-rate in the Kuala Lumpur Interbank Foreign Exchange Market
1Regional countries comprise Singapore, Thailand, Philippines, Indonesia, and Korea
Source: Bank Negara Malaysia, Bursa Malaysia
• Global investors maintained a risk-off approach
throughout May, as concerns over the impact of the
US debt ceiling crisis and the weaker-than-
expected rebound in China’s economy weighed on
global financial markets.
• As a result, the ringgit depreciated against the US
dollar by 3.4% (regional1 average: -1.2%). Similarly,
the FBM KLCI declined by 2.0% (regional1 average:
-1.3%).
• Nonetheless, the 10-year MGS yields decreased
slightly by 3 basis points, supported by non-resident
inflows into the domestic bond market.
Banks maintained strong liquidity and funding positions to support intermediation
• Banks continued to record healthy liquidity buffers
with the aggregate Liquidity Coverage Ratio at
151.2% (April 2023: 154.3%).
• The aggregate loan-to-fund ratio remained stable at
81.8% (April 2023: 82.1%).
Source: Bank Negara Malaysia
Banking System Liquidity and Funding Ratios
81.8
151.2
0
40
80
120
160
70
75
80
85
90
95
M
a
y
2
2
J
u
n
2
2
J
u
l
2
2
A
u
g
2
2
S
e
p
2
2
O
c
t
2
2
N
o
v
2
2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
A
p
r
2
3
M
a
y
2
3
% %
Liquidity Coverage Ratio (RHS)
Loan-to-Fund Ratio
Asset quality in the banking system remained intact
Banking System Asset Quality
Source: Bank Negara Malaysia
• Overall gross and net impaired loans ratios
remained broadly unchanged at 1.80% (April
2023: 1.78%) and 1.10% (April 2023: 1.10%),
respectively.
• Loan loss coverage ratio (including regulatory
reserves) remained at a prudent level of 114.1%
of impaired loans, with total provisions accounting
for 1.7% of total loans.
%
1.8
1.1
1.7
0.5
1.0
1.5
2.0
M
a
y
2
2
J
u
n
2
2
J
u
l
2
2
A
u
g
2
2
S
e
p
2
2
O
c
t
2
2
N
o
v
2
2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
A
p
r
2
3
M
a
y
2
3
Gross Impaired Loans Ratio
Total Provisions to Total Loans Ratio
Net Impaired Loans Ratio
April 2023 Monthly Highlights
Slide 1
Slide 2
| Press Release |
30 Jun 2023 | Detailed Disclosure of International Reserves as at end-May 2023 | https://www.bnm.gov.my/-/detailed-disclosure-of-international-reserves-as-at-end-may-2023-1 | null | null |
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Detailed Disclosure of International Reserves as at end-May 2023
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Detailed Disclosure of International Reserves as at end-May 2023
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30 Jun 2023
In accordance with the International Monetary Fund (IMF) Special Data Dissemination Standard (SDDS) format, the detailed breakdown of international reserves provides forward-looking information on the size, composition, and usability of reserves and other foreign currency assets, and the expected and potential future inflows and outflows of foreign exchange of the Federal Government and Bank Negara Malaysia over the next 12-month period.
The detailed breakdown of international reserves based on the SDDS format is shown in Tables I, II, III and IV.
As shown in Table I, official reserve assets amounted to USD112,664.7 million, while other foreign currency assets amounted to USD301.4 million as at end-May 2023.
As shown in Table II, for the next 12 months, the pre-determined short-term outflows of foreign currency loans, securities and deposits, which include among others, scheduled repayment of external borrowings by the Government and the maturity of foreign currency Bank Negara Interbank Bills, amounted to USD15,007.2 million. The net short forward positions amounted to USD23,404.3 million as at end-May 2023, reflecting the management of ringgit liquidity in the money market. In line with the practice adopted since April 2006, the data excludes projected foreign currency inflows arising from interest income and the drawdown of project loans. Projected foreign currency inflows amount to USD2,176.1 million in the next 12 months.
As shown in Table III, the only contingent short-term net drain on foreign currency assets is Government guarantees of foreign currency debt due within one year, amounting to USD371.0 million. There are no foreign currency loans with embedded options, and no undrawn, unconditional credit lines provided by or to other central banks, international organisations, banks and other financial institutions. Bank Negara Malaysia also does not engage in foreign currency options vis-à-vis ringgit.
Overall, the detailed breakdown of international reserves under the IMF SDDS format indicates that as at end-May 2023, Malaysia’s international reserves remain usable. Related Assets
International Reserves and Foreign Currency Liquidity (31 May 2023)
Bank Negara Malaysia
30 June 2023
© Bank Negara Malaysia, 2023. All rights reserved.
| null | Press Release |
27 Jun 2023 | Statement by the Financial Markets Committee on the Ringgit Foreign Exchange Market | https://www.bnm.gov.my/-/fmc-stmt-jun2023 | null | null |
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Statement by the Financial Markets Committee on the Ringgit Foreign Exchange Market
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Statement by the Financial Markets Committee on the Ringgit Foreign Exchange Market
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27 Jun 2023
The Financial Markets Committee (FMC) held a meeting today to discuss recent financial market developments affecting the ringgit exchange rate.
The external environment continues to be the main driver of the ringgit’s performance, particularly the evolving market expectations of higher terminal interest rates in most major economies, which in turn, raises risks of a possible marked slowdown in the global economy. At the same time, the People’s Bank of China (PBOC) has lowered interest rates amidst signs that China’s post-Covid economic recovery is losing its momentum. The ringgit, along with other regional currencies, has been weighed down by these developments.
Against the backdrop of the US dollar strength, the FMC observed that the extent of the recent depreciation of the ringgit is not reflective of Malaysia’s economic fundamentals. The FMC viewed recent movements in the ringgit exchange rate to be excessive considering the following factors:
i. After recording one of the highest GDP growth rates in the world in 2022, Malaysia's growth momentum is expected to continue in 2023 albeit at a more moderate level, supported by continued domestic investment activity, improving labour market conditions and higher tourism activities. Malaysia's broad and diversified economic structure will help cushion the impact of slowing global growth.
ii. While the strong correlation between the ringgit and renminbi can be explained by the significant trading relationship between Malaysia and China, it is important to note that Malaysia’s external sector remains diversified, both in terms of product segments as well as in terms of trading partners. The FMC observed that this should serve to moderate the close co-movement between the ringgit and the renminbi.
iii. The FMC noted that while the ringgit volatility has risen consistently with those of regional currencies’, the extent of the volatility increases has been disproportionately higher and deviating from historical relative movements. Notwithstanding this, the onshore financial markets remain on solid footing. Ringgit FX volatility remains the lowest among regional peers. This was underpinned by a healthy increase in daily FX turnover volumes over the past few years, averaging USD15.1 billion year-to-date.
iv. In the bond market, non-resident holdings of MGS bonds have remained close to longer-term average figure of 23.5%. Importantly, MGS continues to offer positive real yield and FMC members noted sustained interest among foreign investors in the Malaysian bond market.
Looking ahead, in addition to Malaysia’s strong economic fundamentals, the FMC is of the opinion that further clarity on the US Fed’s terminal rate and possible positive signs from stimulus measures out of China may provide support to the ringgit and Asian currencies in general. As it stands, recent forecasts by analysts and economists continue to point to broad-based recovery against the US dollar by year end (Table 1).
FMC members also discussed observations that corporates and exporters have retained more proceeds in foreign currencies, indicated by rising foreign currency account balances which could potentially lead to imbalance in market flows. In managing their foreign exchange risks, corporates and exporters should be encouraged to take advantage of the attractive level of exchange rate in managing their foreign currency balances.
In concluding the meeting, FMC Chairman and Bank Negara Malaysia Assistant Governor, Adnan Zaylani, added that:
“While the ringgit continues to be affected by global developments, Malaysia’s expected economic growth in the range of 4.0% – 5.0% as well as the structural reforms and fiscal consolidation efforts by the Government, are supporting factors for the ringgit.”
“As per its statutory mandate, BNM will intervene in the foreign exchange market to stem currency movements that are deemed excessive. While the value of the ringgit will continue to remain market-determined, BNM expects that ongoing measures by the Government to further strengthen the economy will help to ensure that the ringgit better reflects the country’s fundamentals,” he added.
Financial Markets Association of Malaysia (FMAM) President, Chu Kok Wei notes, “Financial markets in Malaysia continues to operate in an orderly manner and remains conducive to support our clients’ needs. We welcome BNM’s guidance on the ringgit and recent market developments. We will remain supportive of its efforts in domestic markets.”
Table 1Bank Forecasts
3Q 23
4Q 23
JPMorgan Chase
4.65
4.68
Australia & New Zealand Banking Group
4.50
4.40
Nomura Bank
4.60
4.50
Standard Chartered
4.30
4.40
BNP Paribas
4.57
4.48
MUFG
4.40
4.30
RBC Capital Markets
4.70
4.68
United Overseas Bank
4.68
4.60
Mizuho Bank
4.68
4.43
OCBC
4.52
4.50
Median
4.60
4.50
Average
4.56
4.50Source: Bloomberg
About The Financial Markets Committee (FMC)
The FMC is a committee established by BNM in May 2016 and comprises representatives from Bank Negara Malaysia, financial institutions, corporations, financial service providers and other institutions which have prominent roles or participation in the financial markets.
Bank Negara Malaysia
27 June 2023
© Bank Negara Malaysia, 2023. All rights reserved.
| null | Press Release |
22 Jun 2023 | International Reserves of Bank Negara Malaysia as at 15 June 2023 | https://www.bnm.gov.my/-/international-reserves-of-bank-negara-malaysia-as-at-15-june-2023 | https://www.bnm.gov.my/documents/20124/6118085/qb2021q4_en_box_imports.pdf | null |
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International Reserves of Bank Negara Malaysia as at 15 June 2023
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International Reserves of Bank Negara Malaysia as at 15 June 2023
Embargo :
For immediate release
Not for publication or broadcast before
1500 on
Thursday, 22 June 2023
22 Jun 2023
The international reserves of Bank Negara Malaysia amounted to USD113.0 billion as at 15 June 2023. The reserves position is sufficient to finance 4.8 months of imports of goods and services[1], and is 1.0 time of the total short-term external debt.
[1] Under the previous import coverage measure, reserves is sufficient to finance 6.4 months of retained imports of goods. For more information on the new indicator, please refer to the article on “Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to Imports of Goods and Services” in BNM’s Quarterly Bulletin for the Fourth Quarter of 2021 publication, page 27, which can be accessed at bnm.gov.my/-/quarterly-bulletin-4q-2021 Related Assets
BNM Statement of Assets & Liabilities - 15 June 2023
Bank Negara Malaysia
22 June 2023
© Bank Negara Malaysia, 2023. All rights reserved.
|
Monthly Highlights
Headline inflation declined to 3.4% in March
March 2023
1
3.7 3.4
3.9 3.8
0.00
2.00
4.00
0.0
2.0
4.0
J
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2
F
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-2
2
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-2
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-2
3
M
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2
3
Food & non-alcohol (29.5%) Housing & utilities (23.8%)
Transport (14.6%) Others (32.1%)
Headline inflation (RHS) Core inflation¹ (RHS)
Contribution to Inflation
ppt. contribution %, yoy
1 Core inflation is computed by excluding price-volatile and price-administered items.
Source: Department of Statistics, Malaysia & Bank Negara Malaysia estimates
• Headline inflation declined to 3.4% in March
(February: 3.7%) due mainly to lower inflation for
fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation moderated slightly to 3.8% during
the month (February: 3.9%), driven largely by
lower inflation for food away from home.
1
Robust growth in volume index driven by retail and motor vehicles
Index of Wholesale and Retail Trade
Source: Department of Statistics, Malaysia
• The Index of Wholesale and Retail Trade
(IOWRT) expanded by 10.6% in February 2023
(January: 8.5%).
• The higher growth was driven mainly by retail
sales in non-specialised stores (e.g., department
stores) followed by continued strength in
purchases of motor vehicles amid the ongoing
fulfilment of backlog orders.
• On a month-on-month seasonally adjusted basis,
the index accelerated by 5.5% (January: 0.2%).
9.5 8.510.6
0
10
20
30
40
Feb-
22
Mar-
22
Apr-
22
May-
22
Jun-
22
Jul-
22
Aug-
22
Sep-
22
Oct-
22
Nov-
22
Dec-
22
Jan-
23
Feb-
23
ppt, %yoy
Motor vehicles Retail Wholesale
2.4
5.2
4.4
0
1
2
3
4
5
6
7
Mar-22 Jul-22 Nov-22 Mar-23
Business loans
Household loans
Corporate bonds
Annual growth (%)
Growth in credit to the private non-financial sector moderated
1 Comprises loans to households and non-financial corporations from the
banking system and development financial institutions (DFIs), and corporate
bonds issued by non-financial corporations (including short-term papers).
2 Starting with the publication of December 2022 Monthly Highlights and
Statistics (MHS), this series was introduced to enhance the quality of
financing data. This new data series is available in the MHS Table 2.18.
Source: Bank Negara Malaysia
2.7 2.6 2.7 2.6
1.0 0.6 0.7 0.7
1.0
1.1 1.1 0.9
4.7 4.3 4.5 4.2
Dec-22 Jan-23 Feb-23 Mar-23
Corporate Bonds
Business Loans
Household Loans
Credit to the Private Non-
Financial Sector
Contribution to growth (ppt)
• Credit to the private non-financial sector grew by
4.2% as at end-March (February: 4.5%), attributed
to slower growth in credit to businesses (3.2%;
February: 3.7%).
• While growth in outstanding corporate bonds
moderated (4.4%; February : 5.5%), outstanding
business loan growth was sustained at 2.4%
(February: 2.4%). This was supported by the
continued growth in both working capital (2.2%;
February: 1.9%) and investment-related loans
(4.3%; February: 4.2%).
• Outstanding household loan growth remained
broadly stable (5.2%; February: 5.3%), supported
by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan
growth for the purchase of securities (-6.9%;
February: -3.3%).
Credit to the Private Non-Financial Sector1,2
Monthly Highlights
March 2023
Domestic financial market conditions remained orderly
Financial Market Performance in March 2023
Source: Bank Negara Malaysia, Bursa Malaysia
Note: The exchange rate data is the noon-rate in the Kuala Lumpur Interbank Foreign Exchange Market
11.0
-2.1
-5.3
0.0
-2.2
1.7
10-year MGS
(bps, mom)
Equity
(%, mom)
Ringgit
(%, mom)
-10 -5 0 5 10 15
Mar-23
Feb-23
• In March, global financial markets were affected by
the emergence of banking sector stress in some
major economies. As spillovers were contained thus
far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds
improved.
• In line with the performance of regional currencies,
the ringgit appreciated by 1.7% against the US
dollar. Conditions in the domestic bond market
also remained stable.
• The FBM KLCI declined by 2.2% during the month.
2
Banks maintained strong liquidity and funding positions to support intermediation
Source: Bank Negara Malaysia
Banking System Liquidity and Funding Ratios
81.9
157.4
0
40
80
120
160
70
75
80
85
90
95
M
a
r
2
2
A
p
r
2
2
M
a
y
2
2
J
u
n
2
2
J
u
l
2
2
A
u
g
2
2
S
e
p
2
2
O
c
t
2
2
N
o
v
2
2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
% %
Liquidity Coverage Ratio (RHS)
Loan-to-Fund Ratio
Asset quality in the banking system remained intact
Banking System Asset Quality
Source: Bank Negara Malaysia
• Overall gross and net impaired loans ratios
increased slightly to 1.8% (February-23: 1.8%) and
1.2% (February-23: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory
reserves) continue to record a prudent level of
110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
%
1.8
1.2
1.7
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
M
a
r
2
2
A
p
r
2
2
M
a
y
2
2
J
u
n
2
2
J
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2
2
A
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2
2
S
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p
2
2
O
c
t
2
2
N
o
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2
2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
Gross Impaired Loans Ratio
Total Provisions to Total Loans Ratio
Net Impaired Loans Ratio
• Banks continued to record healthy liquidity buffers
with the aggregate Liquidity Coverage Ratio at
157.4% (February-23: 152.7%).
• The aggregate loan-to-fund ratio remained stable at
81.9% (February-23: 81.6%).
PRESS RELEASE
Ref. No.: 04/23/05 EMBARGO: Not for publication or
broadcast before 1500 hours on
Friday, 28 April 2023
Monthly Highlights – March 2023
Headline inflation declined to 3.4% in March
• Headline inflation declined to 3.4% in March (February: 3.7%) due mainly
to lower inflation for fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation1 moderated slightly to 3.8% during the month
(February: 3.9%), driven largely by lower inflation for food away from
home.
Robust growth in volume index driven by retail and motor vehicles
• The Index of Wholesale and Retail Trade (IOWRT) expanded by 10.6%
in February 2023 (January: 8.5%).
• The higher growth was driven mainly by retail sales in non-specialised
stores (e.g., department stores) followed by continued strength in
purchases of motor vehicles amid the ongoing fulfilment of backlog
orders.
• On a month-on-month seasonally adjusted basis, the index accelerated
by 5.5% (January: 0.2%).
1 Core inflation is computed by excluding price-volatile and price-administered items.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Growth in credit to the private non-financial sector2,3 moderated
• Credit to the private non-financial sector grew by 4.2% as at end-March
(February: 4.5%), attributed to slower growth in credit to businesses
(3.2%; February: 3.7%).
• While growth in outstanding corporate bonds moderated (4.4%;
February: 5.5%), outstanding business loan growth was sustained at
2.4% (February: 2.4%). This was supported by the continued growth in
both working capital (2.2%; February: 1.9%) and investment-related
loans (4.3%; February: 4.2%).
• Outstanding household loan growth remained broadly stable (5.2%;
February: 5.3%), supported by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan growth for the purchase of
securities (-6.9%; February: -3.3%).
Domestic financial market conditions remained orderly
• In March, global financial markets were affected by the emergence of
banking sector stress in some major economies. As spillovers were
contained thus far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds improved.
• In line with the performance of regional currencies, the ringgit
appreciated by 1.7% against the US dollar. Conditions in the domestic
bond market also remained stable.
• The FBM KLCI declined by 2.2% during the month.
Banks maintained strong liquidity and funding positions to support
intermediation
• Banks continued to record healthy liquidity buffers with the aggregate
Liquidity Coverage Ratio at 157.4% (February: 152.7%).
2 Comprises loans to households and non-financial corporations from the banking system and development financial
institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers).
3 Starting with the publication of December 2022 Monthly Highlights and Statistics (MHS), this series was introduced
to enhance the quality of financing data. This new data series is available in the MHS Table 2.18.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
• The aggregate loan-to-fund ratio remained stable at 81.9%
(February: 81.6%).
Asset quality in the banking system remained intact
• Overall gross and net impaired loans ratios increased slightly to 1.8%
(February: 1.8%) and 1.2% (February: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory reserves) continues to
record a prudent level of 110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
Bank Negara Malaysia
28 April 2023
20230428_BNM Monthly Highlights-March_en
Slide 1
Slide 2
20230428_BNM PR_Monthly Highlights-Mar 2023_eng
| Press Release |
09 Jun 2023 | Appointment of Datuk Abdul Rasheed Ghaffour as Governor of Bank Negara Malaysia | https://www.bnm.gov.my/-/appt-new-governor | https://www.bnm.gov.my/documents/20124/10118437/Profile+of+Abdul+Rasheed+Ghaffour.pdf | null |
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Appointment of Datuk Abdul Rasheed Ghaffour as Governor of Bank Negara Malaysia
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Appointment of Datuk Abdul Rasheed Ghaffour as Governor of Bank Negara Malaysia
Embargo :
For immediate release
Not for publication or broadcast before
1821 on
Friday, 9 June 2023
9 Jun 2023
Bank Negara Malaysia today announced that the Yang di-Pertuan Agong has consented to appoint Datuk Shaik Abdul Rasheed bin Abdul Ghaffour as Governor for a five-year term effective 1 July 2023 to 30 June 2028. He will assume the position of Governor from Tan Sri Nor Shamsiah Mohd Yunus, who completes her five-year term on 30 June 2023.
Governor Shamsiah said: “It has been a privilege and honour to have led the Bank for the past five years. I am thankful for the opportunity to lead the Bank in service to the country, especially during such a tumultuous and critical period for the nation.
“I am confident that Rasheed is the right person to helm the Bank as Governor, having worked closely with him for many years. I have full faith in his ability to lead the Bank, and to continue delivering on the Bank’s mandate to promote monetary and financial stability that is conducive to the sustainable growth of the Malaysian economy.”
The Board expressed its appreciation to Governor Shamsiah for her contributions and service to the Bank and country. She has demonstrated exemplary leadership and exceptional commitment in discharging her responsibility as Governor and Chairperson of the Board. The Board is confident that with his extensive experience and proven track record in the Bank, Datuk Abdul Rasheed will drive the Bank further forward and continue its tradition of excellence in advancing the interests of the country.
Datuk Abdul Rasheed said: “It is an honour to be appointed to the position of Governor. I look forward to continue and build on the work of Governor Shamsiah. Under her leadership, the Bank has been steadfast in discharging its mandate to promote monetary and financial stability, even through many challenging periods which include the pandemic crisis. She has also set in motion various organisational modernisation initiatives to reshape and better position the Bank to deal with the opportunities and challenges of the future. I will endeavour to carry out the duties of Governor to the best of my ability.”
Datuk Abdul Rasheed joined the Bank in 1988, rising to the position of Deputy Governor in 2016. He graduated from Universiti Malaya with a Bachelor of Economics. He also holds an MBA from the Saïd Business School, Oxford University. Over the span of his career in the Bank, Datuk Abdul Rasheed has helmed various senior positions. He is currently a member of the Monetary Policy Committee and Financial Stability Committee, a position he has held since 2015. He also played key roles in the development and implementation of the Financial Sector Masterplan and Financial Sector Blueprints.
See also: Profile of Datuk Abdul Rasheed Ghaffour
Bank Negara Malaysia
9 June 2023
© Bank Negara Malaysia, 2023. All rights reserved.
|
Abdul Rasheed Ghaffour CV
Last updated on 11 June 2023
Abdul Rasheed Ghaffour
Employment Deputy Governor 2016 – 2023
Served as Deputy Governor overseeing various core functions of the Bank, which
most recently include the areas of Monetary Policy and Economics, International
Reserves Management and Financial Markets, as well as Financial Sector
Development
Assistant Governor 2014 – 2016
Served as Assistant Governor overseeing sectors which include Monetary Policy
and Economics (Economics, Monetary Policy, International and Statistical
Services departments), and Organisational Development (Strategic Management,
Human Capital Development Centre, and IT Services departments)
Alternate Executive Director, Southeast Asia Voting Group
Office of the International Monetary Fund
2012 – 2014
Represented the Southeast Asia Voting Group, whose members are Brunei,
Cambodia, Fiji, Indonesia, Laos, Malaysia, Nepal, the Philippines, Singapore,
Thailand, Tonga and Vietnam
Director 2006 – 2012
Headed several departments, namely Financial Sector Development, Financial
Surveillance and Prudential Financial Policy
Bank Regulations Department 1988 – 2006
The Bank’s
Platforms and
Committees
• Member, Board of Directors
• Member, Monetary Policy Committee
• Member, Financial Stability Executive Committee
• Member, Financial Stability Committee
• Member, Management Committee
• Member, Reserve Management Committee
• Member, Financial Development Committee
• Member, Risk Management Committee
• Member, Digital Technology Committee
• Co-Chair, Enforcement Committee
• Chair, Crisis Management Team
• Chair, Culture Steering Committee
External
Appointments
• Chairperson, Board of Directors of the Iclif Leadership and Governance
Centre
• Member, Board of Directors and Executive Committee of the South East
Asian Central Banks (SEACEN) Research and Training Centre
• Member, Leadership Council of Malaysia International Islamic Financial
Centre
• Member, Jawatankuasa Pengurusan Kursi, Tun Ismail Ali Chair, Universiti
Malaya
Last updated on 11 June 2023
International
Platforms and
Committees
• Deputy Chairman, Executive Committee of the Islamic Financial Services
Board
• Member, Markets Committee of the Bank for International Settlements
• East Asia Executives’ Meeting of East Asia-Pacific Central Banks
o Member, Deputies’ Meeting
o Member, Monetary and Financial Stability Committee
o Member, ASEAN Bond Fund Oversight Committee
o Member, Pan Asia Bond Index Fund Supervisory Committee
• Member, ASEAN Finance Minister and Central Bank Deputies’ Meeting
• Member, Executive Committee of ASEAN+3 Macroeconomic Research
Office
• Member, Executive Level Decision Making Body of the Chiang Mai Initiative
Multilateralisation
Past Key
Appointments
• Co-Chair, ASEAN Senior Level Committee on Financial Integration
• Member, Board of Trustees of the SEACEN Trust Fund
• Chairman, National Coordination Committee to Counter Money Laundering
(NCC)
• Chairperson, Board of Directors of Cagamas Berhad (the National Mortgage
Corporation of Malaysia)
• Member, Board of Directors of the International Centre for Education in
Islamic Finance
o Chair, Professional Development Panel
o Member, Nomination and Remuneration Committee
• Member, Board of Directors of the Iclif Leadership and Governance Centre
o Chairman, Audit Committee
• Member, Board of Governors of the Asia School of Business
• Chairman, Board of Directors of ASB Management Sdn Bhd
Education and
Qualification
• Masters of Business Administration, Saïd Business School, University of
Oxford
• Bachelor of Economics, Universiti Malaya
• St. John’s Institution, Kuala Lumpur
• Fellow Chartered Banker, Asian Institute of Chartered Bankers
For a list of speeches and interviews, please refer to:
https://www.bnm.gov.my/speeches-interviews/-/tag/rasheed
https://www.bnm.gov.my/speeches-interviews/-/tag/rasheed
| Press Release |
08 Jun 2023 | International Reserves of Bank Negara Malaysia as at 31 May 2023 | https://www.bnm.gov.my/-/international-reserves-of-bank-negara-malaysia-as-at-31-may-2023 | https://www.bnm.gov.my/documents/20124/6118085/qb2021q4_en_box_imports.pdf | null |
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International Reserves of Bank Negara Malaysia as at 31 May 2023
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5
International Reserves of Bank Negara Malaysia as at 31 May 2023
Embargo :
For immediate release
Not for publication or broadcast before
1500 on
Thursday, 8 June 2023
8 Jun 2023
The international reserves of Bank Negara Malaysia amounted to USD112.7 billion as at 31 May 2023. The reserves position is sufficient to finance 4.8 months of imports of goods and services[1], and is 1.0 time of the total short-term external debt.
[1] Under the previous import coverage measure, reserves is sufficient to finance 6.4 months of retained imports of goods. For more information on the new indicator, please refer to the article on “Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to Imports of Goods and Services” in BNM’s Quarterly Bulletin for the Fourth Quarter of 2021 publication, page 27, which can be accessed at bnm.gov.my/-/quarterly-bulletin-4q-2021 Related Assets
BNM Statement of Assets & Liabilities - 31 May 2023
Bank Negara Malaysia
8 June 2023
© Bank Negara Malaysia, 2023. All rights reserved.
|
Monthly Highlights
Headline inflation declined to 3.4% in March
March 2023
1
3.7 3.4
3.9 3.8
0.00
2.00
4.00
0.0
2.0
4.0
J
a
n
-2
2
F
e
b
-2
2
M
a
r-
2
2
A
p
r-
2
2
M
a
y
-2
2
J
u
n
-2
2
J
u
l-
2
2
A
u
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-2
2
S
e
p
-2
2
O
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2
2
N
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v
-2
2
D
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-2
2
J
a
n
-2
3
F
e
b
-2
3
M
a
r-
2
3
Food & non-alcohol (29.5%) Housing & utilities (23.8%)
Transport (14.6%) Others (32.1%)
Headline inflation (RHS) Core inflation¹ (RHS)
Contribution to Inflation
ppt. contribution %, yoy
1 Core inflation is computed by excluding price-volatile and price-administered items.
Source: Department of Statistics, Malaysia & Bank Negara Malaysia estimates
• Headline inflation declined to 3.4% in March
(February: 3.7%) due mainly to lower inflation for
fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation moderated slightly to 3.8% during
the month (February: 3.9%), driven largely by
lower inflation for food away from home.
1
Robust growth in volume index driven by retail and motor vehicles
Index of Wholesale and Retail Trade
Source: Department of Statistics, Malaysia
• The Index of Wholesale and Retail Trade
(IOWRT) expanded by 10.6% in February 2023
(January: 8.5%).
• The higher growth was driven mainly by retail
sales in non-specialised stores (e.g., department
stores) followed by continued strength in
purchases of motor vehicles amid the ongoing
fulfilment of backlog orders.
• On a month-on-month seasonally adjusted basis,
the index accelerated by 5.5% (January: 0.2%).
9.5 8.510.6
0
10
20
30
40
Feb-
22
Mar-
22
Apr-
22
May-
22
Jun-
22
Jul-
22
Aug-
22
Sep-
22
Oct-
22
Nov-
22
Dec-
22
Jan-
23
Feb-
23
ppt, %yoy
Motor vehicles Retail Wholesale
2.4
5.2
4.4
0
1
2
3
4
5
6
7
Mar-22 Jul-22 Nov-22 Mar-23
Business loans
Household loans
Corporate bonds
Annual growth (%)
Growth in credit to the private non-financial sector moderated
1 Comprises loans to households and non-financial corporations from the
banking system and development financial institutions (DFIs), and corporate
bonds issued by non-financial corporations (including short-term papers).
2 Starting with the publication of December 2022 Monthly Highlights and
Statistics (MHS), this series was introduced to enhance the quality of
financing data. This new data series is available in the MHS Table 2.18.
Source: Bank Negara Malaysia
2.7 2.6 2.7 2.6
1.0 0.6 0.7 0.7
1.0
1.1 1.1 0.9
4.7 4.3 4.5 4.2
Dec-22 Jan-23 Feb-23 Mar-23
Corporate Bonds
Business Loans
Household Loans
Credit to the Private Non-
Financial Sector
Contribution to growth (ppt)
• Credit to the private non-financial sector grew by
4.2% as at end-March (February: 4.5%), attributed
to slower growth in credit to businesses (3.2%;
February: 3.7%).
• While growth in outstanding corporate bonds
moderated (4.4%; February : 5.5%), outstanding
business loan growth was sustained at 2.4%
(February: 2.4%). This was supported by the
continued growth in both working capital (2.2%;
February: 1.9%) and investment-related loans
(4.3%; February: 4.2%).
• Outstanding household loan growth remained
broadly stable (5.2%; February: 5.3%), supported
by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan
growth for the purchase of securities (-6.9%;
February: -3.3%).
Credit to the Private Non-Financial Sector1,2
Monthly Highlights
March 2023
Domestic financial market conditions remained orderly
Financial Market Performance in March 2023
Source: Bank Negara Malaysia, Bursa Malaysia
Note: The exchange rate data is the noon-rate in the Kuala Lumpur Interbank Foreign Exchange Market
11.0
-2.1
-5.3
0.0
-2.2
1.7
10-year MGS
(bps, mom)
Equity
(%, mom)
Ringgit
(%, mom)
-10 -5 0 5 10 15
Mar-23
Feb-23
• In March, global financial markets were affected by
the emergence of banking sector stress in some
major economies. As spillovers were contained thus
far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds
improved.
• In line with the performance of regional currencies,
the ringgit appreciated by 1.7% against the US
dollar. Conditions in the domestic bond market
also remained stable.
• The FBM KLCI declined by 2.2% during the month.
2
Banks maintained strong liquidity and funding positions to support intermediation
Source: Bank Negara Malaysia
Banking System Liquidity and Funding Ratios
81.9
157.4
0
40
80
120
160
70
75
80
85
90
95
M
a
r
2
2
A
p
r
2
2
M
a
y
2
2
J
u
n
2
2
J
u
l
2
2
A
u
g
2
2
S
e
p
2
2
O
c
t
2
2
N
o
v
2
2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
% %
Liquidity Coverage Ratio (RHS)
Loan-to-Fund Ratio
Asset quality in the banking system remained intact
Banking System Asset Quality
Source: Bank Negara Malaysia
• Overall gross and net impaired loans ratios
increased slightly to 1.8% (February-23: 1.8%) and
1.2% (February-23: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory
reserves) continue to record a prudent level of
110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
%
1.8
1.2
1.7
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
M
a
r
2
2
A
p
r
2
2
M
a
y
2
2
J
u
n
2
2
J
u
l
2
2
A
u
g
2
2
S
e
p
2
2
O
c
t
2
2
N
o
v
2
2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
Gross Impaired Loans Ratio
Total Provisions to Total Loans Ratio
Net Impaired Loans Ratio
• Banks continued to record healthy liquidity buffers
with the aggregate Liquidity Coverage Ratio at
157.4% (February-23: 152.7%).
• The aggregate loan-to-fund ratio remained stable at
81.9% (February-23: 81.6%).
PRESS RELEASE
Ref. No.: 04/23/05 EMBARGO: Not for publication or
broadcast before 1500 hours on
Friday, 28 April 2023
Monthly Highlights – March 2023
Headline inflation declined to 3.4% in March
• Headline inflation declined to 3.4% in March (February: 3.7%) due mainly
to lower inflation for fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation1 moderated slightly to 3.8% during the month
(February: 3.9%), driven largely by lower inflation for food away from
home.
Robust growth in volume index driven by retail and motor vehicles
• The Index of Wholesale and Retail Trade (IOWRT) expanded by 10.6%
in February 2023 (January: 8.5%).
• The higher growth was driven mainly by retail sales in non-specialised
stores (e.g., department stores) followed by continued strength in
purchases of motor vehicles amid the ongoing fulfilment of backlog
orders.
• On a month-on-month seasonally adjusted basis, the index accelerated
by 5.5% (January: 0.2%).
1 Core inflation is computed by excluding price-volatile and price-administered items.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Growth in credit to the private non-financial sector2,3 moderated
• Credit to the private non-financial sector grew by 4.2% as at end-March
(February: 4.5%), attributed to slower growth in credit to businesses
(3.2%; February: 3.7%).
• While growth in outstanding corporate bonds moderated (4.4%;
February: 5.5%), outstanding business loan growth was sustained at
2.4% (February: 2.4%). This was supported by the continued growth in
both working capital (2.2%; February: 1.9%) and investment-related
loans (4.3%; February: 4.2%).
• Outstanding household loan growth remained broadly stable (5.2%;
February: 5.3%), supported by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan growth for the purchase of
securities (-6.9%; February: -3.3%).
Domestic financial market conditions remained orderly
• In March, global financial markets were affected by the emergence of
banking sector stress in some major economies. As spillovers were
contained thus far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds improved.
• In line with the performance of regional currencies, the ringgit
appreciated by 1.7% against the US dollar. Conditions in the domestic
bond market also remained stable.
• The FBM KLCI declined by 2.2% during the month.
Banks maintained strong liquidity and funding positions to support
intermediation
• Banks continued to record healthy liquidity buffers with the aggregate
Liquidity Coverage Ratio at 157.4% (February: 152.7%).
2 Comprises loans to households and non-financial corporations from the banking system and development financial
institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers).
3 Starting with the publication of December 2022 Monthly Highlights and Statistics (MHS), this series was introduced
to enhance the quality of financing data. This new data series is available in the MHS Table 2.18.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
• The aggregate loan-to-fund ratio remained stable at 81.9%
(February: 81.6%).
Asset quality in the banking system remained intact
• Overall gross and net impaired loans ratios increased slightly to 1.8%
(February: 1.8%) and 1.2% (February: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory reserves) continues to
record a prudent level of 110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
Bank Negara Malaysia
28 April 2023
20230428_BNM Monthly Highlights-March_en
Slide 1
Slide 2
20230428_BNM PR_Monthly Highlights-Mar 2023_eng
| Press Release |
08 Jun 2023 | Structural reforms for Malaysia discussed at the inaugural BNM Sasana Symposium | https://www.bnm.gov.my/-/ss2023-pr-en | null | null |
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Structural reforms for Malaysia discussed at the inaugural BNM Sasana Symposium
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Structural reforms for Malaysia discussed at the inaugural BNM Sasana Symposium
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1100 on
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8 Jun 2023
Seven panel sessions: From macroeconomic topics to current pressing issues such as financial scams, digitalising motor insurance claims, and social protection
Features an experiential showcase of Malaysia’s cross-border QR payment linkages with Indonesia, Singapore, and Thailand
Bank Negara Malaysia (BNM) hosted its first BNM Sasana Symposium 2023 (SS2023) today at Sasana Kijang. Over 700 guests attended the one-day discourse on pertinent topics through seven panel sessions and an experiential showcase of the cross-border QR payment linkages.
At the launch of SS2023, Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Mohd Yunus emphasised the importance of structural reforms.
“To secure our future, the country must stay the course in implementing vital reforms. We must fortify our defences against crises. We must critically examine our priorities to increase our growth potential and meet sustainable goals. We must rebuild the buffers we have drawn down on to strengthen our resilience to future shocks. And we must enhance our capacity to adapt and change in order to manage risks and exploit opportunities that we may not yet see today. For many of the challenges Malaysia faces, the solutions require a whole-of-nation approach. Hence the theme of this Symposium – Structural Reforms for a Stronger Malaysia,” said the Governor.
A key highlight at SS2023 is the showcasing of Malaysia’s cross-border QR payment linkages with Indonesia, Singapore, and Thailand. SS2023 features an exhibition with food vendors from Malaysia, Indonesia, Singapore, and Thailand. Event participants can experience making live cross-border QR payments by purchasing local delectables from food vendors from the participating countries.
Customers of participating financial institutions[1] can now make retail payments by scanning QRIS, NETS, and PromptPay QR codes via mobile banking or e-wallet apps. It supports in-person payments at physical stores and online e-commerce transactions. The same also applies to tourists from these countries to Malaysia.
[1] Participating financial institutions for Malaysia: CIMB Bank Berhad, Hong Leong Bank Berhad, Malayan Banking Berhad, Public Bank Berhad, and TNG Digital Sdn. Bhd
See also: Governor's Welcoming Remarks at SS2023.
Bank Negara Malaysia
8 June 2023
© Bank Negara Malaysia, 2023. All rights reserved.
| null | Press Release |
31 May 2023 | Monetary and Financial Developments in April 2023 | https://www.bnm.gov.my/-/monetary-and-financial-developments-in-april-2023 | https://www.bnm.gov.my/documents/20124/10841907/i_en.pdf | null |
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Monetary and Financial Developments in April 2023
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Monetary and Financial Developments in April 2023
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1500 on
Wednesday, 31 May 2023
31 May 2023
Headline inflation continued to moderate
Headline inflation moderated to 3.3% (March: 3.4%). This decline was mainly due to lower food inflation, such as fresh vegetables, and lower fuel inflation given the lower RON 97 price compared to last year (April 2023: RM 3.35/litre; April 2022: RM 3.84/litre).
Underlying inflation as measured by core inflation[1] also declined to 3.6% (March: 3.8%) mainly due to lower inflation for some discretionary services, particularly food away from home.
Exports declined in April
Exports contracted by 17.4% (March: -1.4%) in April 2023 reflecting weaker external demand and decline in commodity prices.
Manufactured export growth was weighed mainly by manufactures of metal and chemical products. Meanwhile, commodities exports declined due to lower shipments of palm oil and crude petroleum.
Moving forward, the broad slowdown in exports is expected to continue. This is in tandem with the performance of regional economies and slower global growth outlook amid high base effects from robust global demand for goods last year.
Slower growth in credit to the private non-financial sector
Credit to the private non-financial sector[2],[3] grew by 3.7% as at end-April (March: 4.1%), due mainly to slower growth in credit to businesses (2.4%; March: 3.2%).
Outstanding business loans grew at a slower pace (1.0%; March: 2.4%) amid weaker growth in working capital loans, particularly in the non-SME segment (1.6%; March: 5.9%). Growth in outstanding corporate bonds was sustained at 4.4% (March: 4.4%).
For households, outstanding loan growth expanded by 4.9%
(March: 5.1%), supported by higher growth in consumption-related credit (5.2%; March: 4.8%). This reflected sustained growth in credit card spending and loans for the purchase of cars. The growth in loans for the purchase of houses moderated slightly to 6.7% (March: 7.0%).
Domestic financial market adjustments were driven mainly by external developments
In April, global investors maintained a cautious outlook, particularly for advanced economies, as the IMF downgraded its global economic growth expectations. At the same time, global financial conditions continued to be affected by US banking sector developments, as policy rate expectations for the US Federal Reserve shifted lower.
Reflecting global investors’ mixed sentiment, the 10-year MGS yields declined by 18 bps (regional[4] average: -8.9 bps). The ringgit depreciated against the US dollar by 1.1%, in line with the movement in regional4 currencies (average: -0.8%).
Meanwhile, the FBM KLCI fell by 0.5% amid declines mainly in the technology and healthcare sectors, as several semiconductor and glove firms reported weaker quarterly earnings results.
Banks remain well-capitalised to support economic recovery
Banks continue to record strong capital buffers to absorb any unexpected shocks while preserving their ability to provide financing to the economy.
The banking system excess capital buffer[5] stood at RM136.2 billion.
Banks maintained strong liquidity and funding positions to support intermediation
The banking system continues to record healthy liquidity buffers with the aggregate Liquidity Coverage Ratio at 154.3% (March: 157.5%).
The aggregate loan-to-fund ratio remained largely stable at 82.4% (March: 85.1%).
See also: Monthly Highlights [PDF]
[1] Core inflation is computed by excluding price-volatile and price-administered items.
[2] Comprises loans to households and non-financial corporations from the banking system and development financial institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers).
[3] Starting with the publication of December 2022 Monthly Highlights and Statistics (MHS), this series was introduced to enhance the quality of financing data. This new data series is available in the MHS Table 2.18.
4 Regional countries comprise Singapore, Thailand, Philippines, Indonesia, and Korea.
[5] Refers to total capital above the regulatory minimum, which includes the capital conservation buffer (2.5%) and bank-specific higher minimum requirements. Related Assets
Monthly Highlights & Statistics in April 2023
Bank Negara Malaysia
31 May 2023
© Bank Negara Malaysia, 2023. All rights reserved.
|
Monthly Highlights May 2023
Monthly Highlights
Headline inflation declined further to 2.8% in May
May 2023
Contribution to Inflation
ppt. contribution %, yoy
1 Core inflation is computed by excluding price-volatile and price-administered items.
Source: Department of Statistics, Malaysia & Bank Negara Malaysia estimates
• Headline inflation moderated to 2.8% (April 2023:
3.3%). This decline was largely due to non-core
CPI components, particularly lower inflation for
fuel (-0.2 percentage points, ppt) and fresh food
(-0.1ppt).
• Core inflation also declined slightly to 3.5% (April
2023: 3.6%) amid lower inflation for
communication services.
3.3
2.8
3.6 3.5
0.00
2.00
4.00
0.0
2.0
4.0
J
a
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-2
2
F
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b
-2
2
M
a
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2
2
A
p
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2
2
M
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-2
2
J
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-2
2
J
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2
2
A
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-2
2
S
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-2
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O
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2
2
N
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-2
2
D
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-2
2
J
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-2
3
F
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-2
3
M
a
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2
3
A
p
r-
2
3
M
a
y
-2
3
Food & non-alcohol (29.5%) Housing & utilities (23.8%)
Transport (14.6%) Others (32.1%)
Headline inflation (RHS) Core inflation¹ (RHS)
1.6
5.1
4.6
0
1
2
3
4
5
6
7
May-22 Sep-22 Jan-23 May-23
Business loans
Household loans
Corporate bonds
Annual growth (%)
Credit to the Private Non-Financial Sector1,2
1
Growth in credit to the private non-financial sector improved in May
1 Comprises loans to households and non-financial corporations from the
banking system and development financial institutions (DFIs), and corporate
bonds issued by non-financial corporations (including short-term papers).
2 Starting with the publication of December 2022 Monthly Highlights and
Statistics (MHS), this series was introduced to enhance the quality of
financing data. This new data series is available in the MHS Table 2.18.
Source: Bank Negara Malaysia
Contribution to growth (ppt)
• Credit to the private non-financial sector expanded
by 4.0% as at end-May (April 2023: 3.7%), driven
mainly by higher growth in credit to businesses
(2.8%; April 2023: 2.5%).
• Outstanding corporate bonds grew by 4.6% (April
2023: 4.4%), while outstanding business loans
expanded by 1.6% (April 2023: 1.0%). The higher
business loan growth reflected improvement in
loans for both working capital and investments to
SMEs and non-SMEs.
• In the household segment, outstanding loan
growth was sustained at 5.1% (April 2023: 5.0%),
supported by higher growth across most loan
purposes. Of note, household loan growth
continued to be driven by loans for the purchase of
houses and cars, which grew by 7.0% and 8.4%,
respectively (April 2023: 6.8% and 8.0%).
2.7 2.6 2.5 2.6
0.7 0.7 0.3 0.5
1.1 0.9
0.9 1.0
4.5 4.2
3.7 4.0
Feb-23 Mar-23 Apr-23 May-23
Corporate Bonds
Business Loans
Household Loans
Credit to the Private Non-
Financial Sector
Index of wholesale and retail trade growth moderated in April
Source: Department of Statistics, Malaysia
• The Index of Wholesale and Retail Trade
(IOWRT) expanded more moderately by 4.7% in
April 2023 (March 2023: 9.4%). The lower growth
was due mainly to the decline in the motor vehicle
segment.
• However, the retail segment continued to record a
double-digit growth of 10.0% (March 2023:
13.8%), supported by sales in non-specialised and
other specialised stores1.
• On a month-on-month seasonally adjusted basis,
the index increased at a faster pace of 6.5%
(March 2023: -0.9%).
1 Other goods in specialised stores includes clothing, footwear,
pharmaceuticals, cosmetics, watches, jewellery and optical goods.
10.6
9.4
4.7
-2
3
8
13
18
23
28
33
Apr-22 Jun-22 Aug-22 Oct-22 Dec-22 Feb-23 Apr-23
ppt, %yoy
Motor vehicles Retail Wholesale
Index of Wholesale and Retail Trade
Monthly Highlights
2
May 2023
Domestic financial markets were largely affected by external factors
Financial Market Performance in May 2023
-18.0
-0.5
-1.1
-3.0
-2.0
-3.4
10-year MGS
(bps, mom)
Equity
(%, mom)
Ringgit
(%, mom)
-20 -15 -10 -5 0
May-23 Apr-23
Note: The exchange rate data is the noon-rate in the Kuala Lumpur Interbank Foreign Exchange Market
1Regional countries comprise Singapore, Thailand, Philippines, Indonesia, and Korea
Source: Bank Negara Malaysia, Bursa Malaysia
• Global investors maintained a risk-off approach
throughout May, as concerns over the impact of the
US debt ceiling crisis and the weaker-than-
expected rebound in China’s economy weighed on
global financial markets.
• As a result, the ringgit depreciated against the US
dollar by 3.4% (regional1 average: -1.2%). Similarly,
the FBM KLCI declined by 2.0% (regional1 average:
-1.3%).
• Nonetheless, the 10-year MGS yields decreased
slightly by 3 basis points, supported by non-resident
inflows into the domestic bond market.
Banks maintained strong liquidity and funding positions to support intermediation
• Banks continued to record healthy liquidity buffers
with the aggregate Liquidity Coverage Ratio at
151.2% (April 2023: 154.3%).
• The aggregate loan-to-fund ratio remained stable at
81.8% (April 2023: 82.1%).
Source: Bank Negara Malaysia
Banking System Liquidity and Funding Ratios
81.8
151.2
0
40
80
120
160
70
75
80
85
90
95
M
a
y
2
2
J
u
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2
2
J
u
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2
2
A
u
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2
2
S
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2
2
O
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t
2
2
N
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2
D
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2
2
J
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2
3
F
e
b
2
3
M
a
r
2
3
A
p
r
2
3
M
a
y
2
3
% %
Liquidity Coverage Ratio (RHS)
Loan-to-Fund Ratio
Asset quality in the banking system remained intact
Banking System Asset Quality
Source: Bank Negara Malaysia
• Overall gross and net impaired loans ratios
remained broadly unchanged at 1.80% (April
2023: 1.78%) and 1.10% (April 2023: 1.10%),
respectively.
• Loan loss coverage ratio (including regulatory
reserves) remained at a prudent level of 114.1%
of impaired loans, with total provisions accounting
for 1.7% of total loans.
%
1.8
1.1
1.7
0.5
1.0
1.5
2.0
M
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J
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2
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2
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D
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2
2
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3
F
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2
3
M
a
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2
3
A
p
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2
3
M
a
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2
3
Gross Impaired Loans Ratio
Total Provisions to Total Loans Ratio
Net Impaired Loans Ratio
April 2023 Monthly Highlights
Slide 1
Slide 2
| Press Release |
31 May 2023 | Detailed Disclosure of International Reserves as at end-April 2023 | https://www.bnm.gov.my/-/detailed-disclosure-of-international-reserves-as-at-end-april-2023-1 | null | null |
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Detailed Disclosure of International Reserves as at end-April 2023
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Detailed Disclosure of International Reserves as at end-April 2023
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31 May 2023
In accordance with the International Monetary Fund (IMF) Special Data Dissemination Standard (SDDS) format, the detailed breakdown of international reserves provides forward-looking information on the size, composition and usability of reserves and other foreign currency assets, and the expected and potential future inflows and outflows of foreign exchange of the Federal Government and Bank Negara Malaysia over the next 12-month period.
The detailed breakdown of international reserves based on the SDDS format is shown in Tables I, II, III and IV.
As shown in Table I, official reserve assets amounted to USD114,421.5 million, while other foreign currency assets amounted to USD601.3 million as at end-April 2023.
As shown in Table II, for the next 12 months, the pre-determined short-term outflows of foreign currency loans, securities and deposits, which include among others, scheduled repayment of external borrowings by the Government and the maturity of foreign currency Bank Negara Interbank Bills, amounted to USD16,146.4 million. The net short forward positions amounted to USD22,989.3 million as at end-April 2023, reflecting the management of ringgit liquidity in the money market. In line with the practice adopted since April 2006, the data excludes projected foreign currency inflows arising from interest income and the drawdown of project loans. Projected foreign currency inflows amount to USD2,230.2 million in the next 12 months.
As shown in Table III, the only contingent short-term net drain on foreign currency assets are Government guarantees of foreign currency debt due within one year, amounting to USD371.0 million. There are no foreign currency loans with embedded options, no undrawn, unconditional credit lines provided by or to other central banks, international organisations, banks and other financial institutions. Bank Negara Malaysia also does not engage in foreign currency options vis-à-vis ringgit.
Overall, the detailed breakdown of international reserves under the IMF SDDS format indicates that as at end-April 2023, Malaysia’s international reserves remain usable.
Related Assets
International Reserves and Foreign Currency Liquidity (30 April 2023)
Bank Negara Malaysia
31 May 2023
© Bank Negara Malaysia, 2023. All rights reserved.
| null | Press Release |
26 May 2023 | Press Release on Ringgit | https://www.bnm.gov.my/-/ringgit_pr | null | null |
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Press Release on Ringgit
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72
Press Release on Ringgit
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2019 on
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26 May 2023
Ongoing developments in global financial markets have weighed down on market sentiment. These include the US debt ceiling impasse and episodes of stress in the US and European banking sectors. This has led to an increase in demand for safe-haven assets such as the US dollar and outflows from most emerging market economies as investors seek to protect their investments. Against this backdrop, the US dollar has strengthened against most currencies.
Consequently, the ringgit, like most currencies, has faced heightened depreciation pressures. The recent depreciation of the ringgit is therefore not limited to Malaysia alone. It is important to consider the overall performance of the ringgit in relation to not only the US dollar but also the currencies of our significant trading partners. The movement of the ringgit against our major trade partners, as measured by the nominal effective exchange rate (NEER), has been relatively more muted.
In the current environment, external developments are having a more dominant impact on ringgit performance. Given this, the ringgit’s performance against the US dollar, or any particular currency, is not a reflection of the state of the economy.
Malaysia’s economy is expected to continue expanding within the range of 4.0 – 5.0% in 2023. Domestic demand will continue to drive growth, supported by the continued recovery in the labour market and the realisation of approved multi-year investment projects, such as the ECRL, LRT3, and Pan Borneo Highway. At the same time, Malaysia’s diversified export markets and product segments will continue to support the resiliency of the external sector.
The movements in the ringgit would continue to be market determined and BNM will continue to manage the risks arising from heightened financial market volatility. To this end, BNM’s market operations will ensure sufficient liquidity and orderly functioning of financial markets. The ringgit’s performance should improve as uncertainties from global market developments subside. This in turn will better reflect Malaysia’s sound economic fundamentals.
Bank Negara Malaysia
26 May 2023
© Bank Negara Malaysia, 2023. All rights reserved.
| null | Press Release |
22 May 2023 | International Reserves of Bank Negara Malaysia as at 15 May 2023 | https://www.bnm.gov.my/-/international-reserves-of-bank-negara-malaysia-as-at-15-may-2023 | https://www.bnm.gov.my/documents/20124/6118085/qb2021q4_en_box_imports.pdf | null |
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International Reserves of Bank Negara Malaysia as at 15 May 2023
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International Reserves of Bank Negara Malaysia as at 15 May 2023
Embargo :
For immediate release
Not for publication or broadcast before
1500 on
Monday, 22 May 2023
22 May 2023
The international reserves of Bank Negara Malaysia amounted to USD114.7 billion as at 15 May 2023. The reserves position is sufficient to finance 4.9 months of imports of goods and services[1], and is 1.0 times the total short-term external debt.
[1] Under the previous import coverage measure, reserves is sufficient to finance 6.5 months of retained imports of goods. For more information on the new indicator, please refer to the article on “Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to Imports of Goods and Services” in BNM’s Quarterly Bulletin for the Fourth Quarter of 2021 publication, page 27, which can be accessed at bnm.gov.my/-/quarterly-bulletin-4q-2021 Related Assets
BNM Statement of Assets & Liabilities - 15 May 2023
Bank Negara Malaysia
22 May 2023
© Bank Negara Malaysia, 2023. All rights reserved.
|
Monthly Highlights
Headline inflation declined to 3.4% in March
March 2023
1
3.7 3.4
3.9 3.8
0.00
2.00
4.00
0.0
2.0
4.0
J
a
n
-2
2
F
e
b
-2
2
M
a
r-
2
2
A
p
r-
2
2
M
a
y
-2
2
J
u
n
-2
2
J
u
l-
2
2
A
u
g
-2
2
S
e
p
-2
2
O
c
t-
2
2
N
o
v
-2
2
D
e
c
-2
2
J
a
n
-2
3
F
e
b
-2
3
M
a
r-
2
3
Food & non-alcohol (29.5%) Housing & utilities (23.8%)
Transport (14.6%) Others (32.1%)
Headline inflation (RHS) Core inflation¹ (RHS)
Contribution to Inflation
ppt. contribution %, yoy
1 Core inflation is computed by excluding price-volatile and price-administered items.
Source: Department of Statistics, Malaysia & Bank Negara Malaysia estimates
• Headline inflation declined to 3.4% in March
(February: 3.7%) due mainly to lower inflation for
fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation moderated slightly to 3.8% during
the month (February: 3.9%), driven largely by
lower inflation for food away from home.
1
Robust growth in volume index driven by retail and motor vehicles
Index of Wholesale and Retail Trade
Source: Department of Statistics, Malaysia
• The Index of Wholesale and Retail Trade
(IOWRT) expanded by 10.6% in February 2023
(January: 8.5%).
• The higher growth was driven mainly by retail
sales in non-specialised stores (e.g., department
stores) followed by continued strength in
purchases of motor vehicles amid the ongoing
fulfilment of backlog orders.
• On a month-on-month seasonally adjusted basis,
the index accelerated by 5.5% (January: 0.2%).
9.5 8.510.6
0
10
20
30
40
Feb-
22
Mar-
22
Apr-
22
May-
22
Jun-
22
Jul-
22
Aug-
22
Sep-
22
Oct-
22
Nov-
22
Dec-
22
Jan-
23
Feb-
23
ppt, %yoy
Motor vehicles Retail Wholesale
2.4
5.2
4.4
0
1
2
3
4
5
6
7
Mar-22 Jul-22 Nov-22 Mar-23
Business loans
Household loans
Corporate bonds
Annual growth (%)
Growth in credit to the private non-financial sector moderated
1 Comprises loans to households and non-financial corporations from the
banking system and development financial institutions (DFIs), and corporate
bonds issued by non-financial corporations (including short-term papers).
2 Starting with the publication of December 2022 Monthly Highlights and
Statistics (MHS), this series was introduced to enhance the quality of
financing data. This new data series is available in the MHS Table 2.18.
Source: Bank Negara Malaysia
2.7 2.6 2.7 2.6
1.0 0.6 0.7 0.7
1.0
1.1 1.1 0.9
4.7 4.3 4.5 4.2
Dec-22 Jan-23 Feb-23 Mar-23
Corporate Bonds
Business Loans
Household Loans
Credit to the Private Non-
Financial Sector
Contribution to growth (ppt)
• Credit to the private non-financial sector grew by
4.2% as at end-March (February: 4.5%), attributed
to slower growth in credit to businesses (3.2%;
February: 3.7%).
• While growth in outstanding corporate bonds
moderated (4.4%; February : 5.5%), outstanding
business loan growth was sustained at 2.4%
(February: 2.4%). This was supported by the
continued growth in both working capital (2.2%;
February: 1.9%) and investment-related loans
(4.3%; February: 4.2%).
• Outstanding household loan growth remained
broadly stable (5.2%; February: 5.3%), supported
by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan
growth for the purchase of securities (-6.9%;
February: -3.3%).
Credit to the Private Non-Financial Sector1,2
Monthly Highlights
March 2023
Domestic financial market conditions remained orderly
Financial Market Performance in March 2023
Source: Bank Negara Malaysia, Bursa Malaysia
Note: The exchange rate data is the noon-rate in the Kuala Lumpur Interbank Foreign Exchange Market
11.0
-2.1
-5.3
0.0
-2.2
1.7
10-year MGS
(bps, mom)
Equity
(%, mom)
Ringgit
(%, mom)
-10 -5 0 5 10 15
Mar-23
Feb-23
• In March, global financial markets were affected by
the emergence of banking sector stress in some
major economies. As spillovers were contained thus
far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds
improved.
• In line with the performance of regional currencies,
the ringgit appreciated by 1.7% against the US
dollar. Conditions in the domestic bond market
also remained stable.
• The FBM KLCI declined by 2.2% during the month.
2
Banks maintained strong liquidity and funding positions to support intermediation
Source: Bank Negara Malaysia
Banking System Liquidity and Funding Ratios
81.9
157.4
0
40
80
120
160
70
75
80
85
90
95
M
a
r
2
2
A
p
r
2
2
M
a
y
2
2
J
u
n
2
2
J
u
l
2
2
A
u
g
2
2
S
e
p
2
2
O
c
t
2
2
N
o
v
2
2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
% %
Liquidity Coverage Ratio (RHS)
Loan-to-Fund Ratio
Asset quality in the banking system remained intact
Banking System Asset Quality
Source: Bank Negara Malaysia
• Overall gross and net impaired loans ratios
increased slightly to 1.8% (February-23: 1.8%) and
1.2% (February-23: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory
reserves) continue to record a prudent level of
110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
%
1.8
1.2
1.7
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
M
a
r
2
2
A
p
r
2
2
M
a
y
2
2
J
u
n
2
2
J
u
l
2
2
A
u
g
2
2
S
e
p
2
2
O
c
t
2
2
N
o
v
2
2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
Gross Impaired Loans Ratio
Total Provisions to Total Loans Ratio
Net Impaired Loans Ratio
• Banks continued to record healthy liquidity buffers
with the aggregate Liquidity Coverage Ratio at
157.4% (February-23: 152.7%).
• The aggregate loan-to-fund ratio remained stable at
81.9% (February-23: 81.6%).
PRESS RELEASE
Ref. No.: 04/23/05 EMBARGO: Not for publication or
broadcast before 1500 hours on
Friday, 28 April 2023
Monthly Highlights – March 2023
Headline inflation declined to 3.4% in March
• Headline inflation declined to 3.4% in March (February: 3.7%) due mainly
to lower inflation for fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation1 moderated slightly to 3.8% during the month
(February: 3.9%), driven largely by lower inflation for food away from
home.
Robust growth in volume index driven by retail and motor vehicles
• The Index of Wholesale and Retail Trade (IOWRT) expanded by 10.6%
in February 2023 (January: 8.5%).
• The higher growth was driven mainly by retail sales in non-specialised
stores (e.g., department stores) followed by continued strength in
purchases of motor vehicles amid the ongoing fulfilment of backlog
orders.
• On a month-on-month seasonally adjusted basis, the index accelerated
by 5.5% (January: 0.2%).
1 Core inflation is computed by excluding price-volatile and price-administered items.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Growth in credit to the private non-financial sector2,3 moderated
• Credit to the private non-financial sector grew by 4.2% as at end-March
(February: 4.5%), attributed to slower growth in credit to businesses
(3.2%; February: 3.7%).
• While growth in outstanding corporate bonds moderated (4.4%;
February: 5.5%), outstanding business loan growth was sustained at
2.4% (February: 2.4%). This was supported by the continued growth in
both working capital (2.2%; February: 1.9%) and investment-related
loans (4.3%; February: 4.2%).
• Outstanding household loan growth remained broadly stable (5.2%;
February: 5.3%), supported by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan growth for the purchase of
securities (-6.9%; February: -3.3%).
Domestic financial market conditions remained orderly
• In March, global financial markets were affected by the emergence of
banking sector stress in some major economies. As spillovers were
contained thus far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds improved.
• In line with the performance of regional currencies, the ringgit
appreciated by 1.7% against the US dollar. Conditions in the domestic
bond market also remained stable.
• The FBM KLCI declined by 2.2% during the month.
Banks maintained strong liquidity and funding positions to support
intermediation
• Banks continued to record healthy liquidity buffers with the aggregate
Liquidity Coverage Ratio at 157.4% (February: 152.7%).
2 Comprises loans to households and non-financial corporations from the banking system and development financial
institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers).
3 Starting with the publication of December 2022 Monthly Highlights and Statistics (MHS), this series was introduced
to enhance the quality of financing data. This new data series is available in the MHS Table 2.18.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
• The aggregate loan-to-fund ratio remained stable at 81.9%
(February: 81.6%).
Asset quality in the banking system remained intact
• Overall gross and net impaired loans ratios increased slightly to 1.8%
(February: 1.8%) and 1.2% (February: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory reserves) continues to
record a prudent level of 110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
Bank Negara Malaysia
28 April 2023
20230428_BNM Monthly Highlights-March_en
Slide 1
Slide 2
20230428_BNM PR_Monthly Highlights-Mar 2023_eng
| Press Release |
12 May 2023 | Joint Statement by Bank Negara Malaysia and Securities Commission Malaysia: Updates from the 10th Joint Committee on Climate Change (JC3) Meeting | https://www.bnm.gov.my/-/jc3-10th-meeting-en | null | null |
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Joint Statement by Bank Negara Malaysia and Securities Commission Malaysia: Updates from the 10th Joint Committee on Climate Change (JC3) Meeting
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Joint Statement by Bank Negara Malaysia and Securities Commission Malaysia: Updates from the 10th Joint Committee on Climate Change (JC3) Meeting
Embargo :
For immediate release
Not for publication or broadcast before
1930 on
Friday, 12 May 2023
12 May 2023
The Joint Committee on Climate Change (JC3) convened its tenth meeting on 9 May 2023 to review developments in the financial sector’s ongoing response to climate-related risks and related initiatives supported by JC3.
Supporting the credible, consistent and reliable implementation of the Climate Change and Principle-based Taxonomy (CCPT) continues to be one of the key priorities of JC3. Considerable variations in practice continue to be observed in the classification of assets and investments by financial institutions. Work by JC3 to publish guidance in the form of FAQs, expand use cases and develop due diligence and screening criteria are helping to converge practices. However, JC3 members noted that this needs to be complemented by further efforts to address prevailing data gaps and support capacity building within businesses themselves to assess the impact of their operations on climate outcomes and the broader environment. JC3 aims to substantially complete further work to align practices in the implementation of the CCPT by the end of 2023.
In light of the upcoming release of the general sustainability-related (S1) and climate-related (S2) disclosure standards by the International Sustainability Standards Board (ISSB), JC3 will review the TCFD[1] Application Guide for Malaysian Financial Institutions[2] which was published in June 2022 to take into account the requirements under these new standards. As the ISSB Standards are aligned with TCFD recommendations, the Application Guide will continue to serve as a useful practical reference for financial institutions in Malaysia – particularly in supporting enhanced sustainability and climate-related disclosures.
Members also discussed updates on the implementation of three initial green pilot projects and several capital market initiatives supported by JC3 that aim to expand sustainable and transition finance. The projects and initiatives focus on greening supply chains, scaling up green technology adoption in the agriculture sector, increasing climate resilience through parametric flood insurance and supporting the development of the sustainable sukuk and bond market.
Kamarudin Hashim, Managing Director of Securities Commission Malaysia and Co-Chair of JC3, stated, “As Malaysia transitions towards a low-carbon economy and a more sustainable future, it is critical that both companies and financial institutions play their part to facilitate this transition. JC3, through its initiatives, is actively exploring ways to assist companies to move towards a low-carbon economy in a just and orderly manner, while supporting financial institutions to accelerate capital allocation towards companies demonstrating credible climate transition pathways.”
As part of efforts to prioritise strategies and solutions that support transition by SMEs, an SME Focus Group has been established within JC3. Its immediate focus is on raising awareness, reducing the cost of transition in the area of green certifications and facilitating better disclosures by SMEs.
Jessica Chew, Deputy Governor of Bank Negara Malaysia and Co-Chair of JC3, said “60% of SMEs believe that strengthening ESG[3] practices can increase business opportunities and create long-term value. However, only 28% of SMEs have adopted elements of ESG practices in their businesses[4]. The formation of the SME Focus Group will enable JC3 to take a more focused and targeted approach in addressing the specific issues and challenges facing SMEs in order to close this gap.”
JC3’s biennial flagship conference on climate change will take place in October 2023. This regional conference will bring together a diverse range of climate experts, advocates, innovators and practitioners to discuss the practical applications of climate and nature finance, helping the financial sector and its customers move from theory to practice. Further details on the Conference will be made available to the public in due course.
JC3 continues to actively engage and collaborate with relevant Government ministries and agencies as well as industry associations to encourage greater alignment in the financial sector’s response to climate-related risks with national and business strategies. At this meeting, members welcomed an exchange of presentations by the Ministry of Natural Resources, Environment and Climate Change and the Ministry of Economy on climate-related plans and timelines which provided the financial sector with a better understanding and appreciation of the Government’s priorities.
Bank Negara Malaysia
Securities Commission Malaysia
12 May 2023
About the JC3
The JC3 is a platform established in September 2019 to pursue collaborative actions for building climate resilience within the Malaysian financial sector. The JC3 is co-chaired by Datuk Jessica Chew Cheng Lian, Deputy Governor Bank Negara Malaysia and Kamarudin Hashim, Managing Director Securities Commission Malaysia, with members comprising senior officials from Bursa Malaysia and 21 financial industry players. The JC3’s initiatives and priorities are undertaken by its five sub-committees, namely Risk Management; Governance and Disclosure; Product and Innovation; Engagement and Capacity Building; and Bridging Data Gaps.
Members: Allianz General Insurance Company (Malaysia) Berhad, AmBank (M) Berhad, Bank Islam Malaysia Berhad, Bank Pembangunan Malaysia Berhad, Bank Pertanian Malaysia Berhad (Agrobank), BIMB Investment Management Berhad, BNP Paribas Asset Management Sdn. Bhd., Bursa Malaysia Berhad, CIMB Bank, Etiqa Family Takaful Berhad, HSBC Amanah Malaysia Berhad, Kenanga Investors Berhad, Maybank Berhad, MIDF Amanah Investment Bank Berhad, MSIG Insurance (Malaysia) Berhad, RHB Islamic Bank Berhad, RHB Islamic International Asset Management Bhd., Standard Chartered Bank Malaysia Berhad, Swiss Re Asia Pte. Ltd. (Swiss Retakaful), Syarikat Takaful Malaysia Am Berhad, UOB Asset Management (Malaysia) Berhad and Zurich General Insurance Malaysia Berhad
[1] Task Force on Climate-related Financial Disclosures
[2] Released by JC3 in 2022
[3] Environmental, Social and Governance
[4] “ESG Insights from Malaysian SMEs: Building A Better Future Together” by Alliance Bank in partnership with UN Global Compact Network Malaysia & Brunei (UNGCMYB) and SME Corporation Malaysia (SME Corp)
Bank Negara Malaysia
12 May 2023
© Bank Negara Malaysia, 2023. All rights reserved.
| null | Press Release |
12 May 2023 | Economic and Financial Developments in Malaysia in the First Quarter of 2023 | https://www.bnm.gov.my/-/qb23q1_en_pr | https://www.bnm.gov.my/documents/20124/10644344/qb23q1_en_table1.pdf, https://www.bnm.gov.my/documents/20124/10644344/qb23q1_slides.pdf, https://www.bnm.gov.my/documents/20124/10644344/qb23q1_transcript.pdf | null |
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Economic and Financial Developments in Malaysia in the First Quarter of 2023
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Economic and Financial Developments in Malaysia in the First Quarter of 2023
Embargo :
For immediate release
Not for publication or broadcast before
1200 on
Friday, 12 May 2023
12 May 2023
The economy expanded by 5.6% in the first quarter (4Q 2022: 7.1%)
The Malaysian economy further expanded in the first quarter of 2023 (5.6%; 4Q 2022: 7.1%; 1Q 2011 - 4Q 2019 average: 5.1%), driven mainly by domestic demand. Further improvement in the labour market, with strong growth in employment and continued expansion in wages, have supported private consumption spending. Meanwhile, investment activity was underpinned by capacity expansion and continued implementation of multi-year projects. Inbound tourism continued to recover, lifting services exports and partially offsetting the slower goods export growth. On the supply side, the services and manufacturing sectors continued to drive growth. On a quarter-on-quarter seasonally-adjusted basis, the economy grew by 0.9% (4Q 2022: -1.7%).
Headline inflation during the quarter trended lower to 3.6% (4Q 2022: 3.9%). This was due mainly to the moderation in core inflation and lower RON97 price. The decline in core inflation (1Q 2023: 3.9%; 4Q 2022: 4.2%) was largely contributed by selected services. These include telephone and telefax service, food away from home, and personal transport repair and maintenance. Even as cost pressures, particularly global commodity prices, continued to ease, core inflation remained elevated during the quarter amid continued strength in demand. Price pressures remained pervasive. The share of Consumer Price Index (CPI) items recording monthly price increases rose to 56.0% during the quarter (4Q 2022: 51.2%). This in part reflected price adjustments by firms typically done at the beginning of the year (1Q average from 2011 - 2019: 52.2%; Overall average from 2011 - 2019: 45.6%), as well as continued price increases for some food-related items.
Exchange rate developments
Domestic financial conditions remained broadly stable despite uncertainties surrounding the global economic outlook. Financial market expectations for US monetary policy were affected by evolving concerns over the US economy. These include the pace of disinflation and sustainability of its economic momentum. By the end of the quarter, risks from banking sector stress in the US and Europe weighed further on these expectations. As a result, the US dollar broadly depreciated amid shifting sentiments surrounding these developments, reversing its appreciation gains during first half of the quarter.
Against this backdrop, the ringgit continued to exhibit two-way movements with an overall marginal appreciation of 0.1% against the US dollar during the quarter. Moving forward, Bank Negara Malaysia will continue to closely monitor the global and domestic financial conditions while ensuring orderly financial market adjustments.
Financing conditions
Credit to the private non-financial sector expanded by 4.2% (4Q 2022: 4.7%). This was accounted mainly by slower growth in outstanding loans (1Q 2023: 4.7%; 4Q 2022: 5.7%) and outstanding corporate bonds (1Q 2023: 4.4%, 4Q 2022: 4.6%). Outstanding business loans grew by 2.4%, following slower growth in working capital loans. Nonetheless, investment-related loans remained forthcoming, especially in the SME segment. For households, outstanding loan growth expanded by 5.2%. This was supported by sustained growth in outstanding loans for the purchase of big-ticket items, with higher growth recorded particularly for car purchases.
Malaysia’s growth to remain resilient in 2023, anchored by firm domestic demand
Despite global headwinds, the Malaysian economy is projected to expand by 4.0% to 5.0% in 2023, driven by firm domestic demand. Improving employment and income as well as continued implementation of multi-year projects would support consumption and investment activity. Moreover, higher inbound tourism activity would lift high-touch services industries. Governor Tan Sri Nor Shamsiah Mohd Yunus said, “Risks to Malaysia’s growth outlook are relatively balanced. Upside risks stem mainly from domestic factors. These include stronger-than-expected tourism activity and implementation of projects including those from the re-tabled Budget 2023. Meanwhile, downside risks could emanate from lower exports due to weaker-than-expected global growth and more volatile global financial market conditions.”
Headline and core inflation to moderate over the course of 2023 although core inflation would remain elevated
Headline and core inflation are expected to moderate but would remain above historical average in 2023. The moderation reflects lower global cost factors amid easing supply chain disruptions and lower commodity prices. However, core inflation will remain at elevated levels amid firm demand conditions. Existing price controls and fuel subsidies will continue to partly contain the extent of upward inflationary pressures. The balance of risk to the inflation outlook is tilted to the upside and remains highly subject to any changes in domestic policy, financial market developments and global commodity prices.
See also:
Press Conference Slides (PDF)
Press Conference Presentation Transcript
Press Conference Video
Publication: Quarterly Bulletin First Quarter 2023
Table 1: GDP by Expenditure Components and Economic ActivityBank Negara Malaysia
12 May 2023
© Bank Negara Malaysia, 2023. All rights reserved.
|
27Quarterly Bulletin | 1Q 2023
Annex
Share
2022
(%)
2022 2023
1Q 2Q 3Q 4Q Year 1Q
Annual growth (%)
Aggregate Domestic Demand (excluding stocks)
Private sector
Consumption
Investment
Public sector
Consumption
Investment
Net Exports
Exports of Goods and Services
Imports of Goods and Services
93.1
75.5
60.2
15.3
17.6
13.2
4.4
5.5
74.6
69.1
4.4
4.3
5.3
0.4
4.9
6.9
-1.1
-28.9
12.3
16.1
13.0
15.4
18.3
6.3
2.5
2.3
3.2
-29.0
15.9
20.1
13.2
14.4
14.8
13.2
7.9
6.5
13.1
26.2
21.5
21.1
6.8
7.8
7.3
10.3
3.9
3.0
6.0
23.0
8.6
7.2
9.2
10.3
11.2
7.2
4.7
4.5
5.3
-1.0
14.5
15.9
4.6
5.6
5.9
4.7
-0.3
-2.2
5.7
54.4
-3.3
-6.5
Real GDP 100.0 4.8 8.8 14.1 7.1 8.7 5.6
GDP (q-o-q growth, seasonally adjusted) - 2.4 4.1 2.2 -1.7 - 0.9
Note: Figures may not add up due to rounding and exclusion of stocks.
Source: Department of Statistics, Malaysia
Table 1: GDP by Expenditure Components (at constant 2015 prices)
Share
2022
(%)
2022 2023
1Q 2Q 3Q 4Q Year 1Q
Annual growth (%)
Services
Manufacturing
Agriculture
Mining
Construction
58.3
24.1
6.6
6.4
3.5
6.4
6.7
0.1
-2.2
-6.1
11.9
9.2
-2.3
-1.7
2.5
16.7
13.1
1.2
9.1
15.3
9.1
3.9
1.1
6.3
10.1
10.9
8.1
0.1
2.6
5.0
7.3
3.2
0.9
2.4
7.4
Real GDP 100.0 4.8 8.8 14.1 7.1 8.7 5.6
Note: Numbers do not add up due to rounding and exclusion of import duties component.
Source: Department of Statistics, Malaysia
Table 2: GDP by Economic Activity (at constant 2015 prices)
GDP Q1 2023 Presentation Slides
Sidang Akhbar
Prestasi Ekonomi Suku
12 Mei 2023
Pertama Tahun 2023
1
Global Growth Developments
The global economy grew modestly in 1Q 2023
Note:
1 GDP for the fourth quarter of 2022 are advanced or preliminary estimates except for China, Indonesia, and Philippines.
2 Inflation figures are aggregated across major countries based on their share of global growth. AEs stands for Advanced Economies while EMEs stands for Emerging Market Economies.
Source: Macrobond, National authorities, International Monetary Fund, Bank Negara Malaysia estimates
4.5
6.7
4.3
3.6
4.8
4.2
8.1
5.6
5.5
3.0
Jan-22 Apr-22 Jul-22 Oct-22 Jan-23
World Headline
World Core
AEs Headline
EMEs Headline
Inflation2
2
6.4
5.0
4.5
1.6
1.3 0.8 0.1
-3.0
7.1
5.0
2.9
0.9
1.8
1.3
2.1
-0.4
PH ID CN US EA KR SG TW
1Q23 4Q22
Real GDP Growth1
Annual change (%)
Moderating headline
inflation, but core
inflation still high
Modest global growth
amid China reopening
and resilient labour
market in AEs
Regional exports
continued to contract
amid weak demand
for goods
Mar-23
Malaysia’s GDP grew by 5.6% in 1Q 2023
Source: Department of Statistics, Malaysia
Factors Supporting Growth in 1Q 2023
3
Continued investment
activity
Further expansion of
household spending
-0.2
16.2
-4.2
3.6
4.8
8.8
14.1
7.1
5.6
2.2
-1.7
0.9
1Q-21 3Q-21 1Q-22 3Q-22 1Q-23
Annual change (%)
q-o-q SA
Real GDP Growth (Quarterly)
Higher tourism
activities
Improving labour market
Monthly Real GDP Growth (Annual change, %)
Oct-22 Nov-22 Dec-22 Jan-23 Feb-23 Mar-23
7.3 4.5 9.6 4.6 6.6 5.6
Growth underpinned by private consumption and investments, and the services
and manufacturing sectors
Source: Department of Statistics, Malaysia
4
Private Consumption
Broad-based expansion in necessities and
discretionary spending
Driven mainly by services and manufacturing sectors
54.4
23.0
1Q23
4Q22
-2.2
3.0
1Q23
4Q22
5.7
6.0
1Q23
4Q22
4.7
10.3
1Q23
4Q22
5.9
7.3
1Q23
4Q22
Private Investment
Supported mainly by investment in structures
Public Investment
Driven by capital expenditure by public corporations
Public Consumption
Lower supplies & services spending
Net Exports
Further recovery in tourism activities
Driven mainly by private sector expenditure
7.4
10.1
1Q23
4Q22
2.4
6.3
1Q23
4Q22
0.9
1.1
1Q23
4Q22
3.2
3.9
1Q23
4Q22
7.3
9.1
1Q23
4Q22 Services
Supported by both consumer and
business-related service activities
Manufacturing
Continued growth driven by domestic-
oriented industries and E&E cluster
Agriculture
Increased oil palm output supported by
higher arrivals of foreign workers
Mining
More moderate growth in oil and gas production
Construction
Continued progress of large transportation and
utility projects
Annual Change (%) Annual Change (%)
19.2
-2.1
6.8
14.4
12.0
7.7
5.8
-1.4
Total Reinvestment
of Earnings
Equity Injection Debt Instruments
4Q22 1Q23
27.5
57.7
-12.1 -11.6
-6.5
4.3
39.9
-12.8
-16.9
-5.9
Current Account
Balance
Goods Services Primary
Income
Secondary
Income
4Q22
1Q23
Lower current account surplus and FDI inflows
Source: Department of Statistics, Malaysia
RM bil
▪ Smaller goods surplus driven mainly by the moderation in
external demand
▪ Larger primary income deficit due mainly to lower investment
income accrued to Malaysians from investments abroad
Current Account Foreign Direct Investment
RM bil
▪ Continued FDI inflows supported by reinvestment of
earnings and equity injections
▪ FDI was mainly channelled into the financial services
subsector as well as mining and manufacturing sectors
5
Current Account (% of GDP)
1Q 2023: 1.0%
4Q 2022: 5.9%
Recent developments reaffirm outlook for 2023
6
Source: Department of Statistics, Malaysia
Seasonally Adjusted Real GDP Indexed Levels
98 98
95
100
103
107
109
107
108
1Q-21 2Q-21 3Q-21 4Q-21 1Q-22 2Q-22 3Q-22 4Q-22 1Q-23
4Q 2019=100
On a seasonally adjusted basis, the economy has
recovered to its pre-crisis levels
Further improvements in labour market conditions
15.8
4Q-22
16.1
1Q-233Q-22
15.9
Employment levels
Million Persons
Real wages
0.9% (1.7% in 4Q22)
Nominal wages
4.5% (5.7% in 4Q22)
Private sector wages
Annual change, %
Unemployment rate,
Annual change, %
3.7
3Q-22 4Q-22
3.6 3.5
1Q-23
Manufacturing
4.3% (5.0% in 4Q22)
Services
4.6% (6.1% in 4Q22)
Sectoral Nominal Wage growth
Annual change, %
2019: 15.1 million 2019: 3.3%
4Q19: 3.8%
4Q19: 4.8%
4Q19: 4.4%
4Q19: 5.0%
Growth continues to be underpinned by domestic demand
Continued strength in household spending On-going implementation of projects supported
investment activity
7
Key Infrastructure Projects Cumulative Progress Rate
ECRL
RM50.0 billion
2018 2026
41%
LRT3
RM16.6 billion
2018 2024
84%
MyDIGITAL 5G
RM16.5 billion
2021 2031
55%
Pan Borneo
Highway (Sabah)
RM16.0 billion
2016 2024
73%
Source: Department of Statistics Malaysia, Malaysian Automotive Association, and newsflows
180.9
170.6
1Q22 2Q22 3Q22 4Q22 1Q23
Index of Retail Trade
168.8
258.1
1Q22 2Q22 3Q22 4Q22 1Q23
Index of Retail Trade
Index of Online Retail
2019 Avg
’15-’19 avg: 135.2
IORT 2019 avg: 139.5
Passenger car sales
Index (2015=100) Thousand units
Online retail 2019 avg: 136.3
Export growth slowed in 1Q 2023 following weaker external demand
0.3
5.7
10.1
12.2 12.3
1Q-22 2Q-22 3Q-22 4Q-22 1Q-23
Nevertheless, our diversified export markets, improving China economy and higher travel receipts will cushion global growth slowdown
1Q23 Gross Exports by Market
Annual change, %
Travel Receipts
RM billion
8.0
6.3
4.3
-2.3
-8.1
US (11%*)
ASEAN (30%)
Japan (7%)
EU (8%)
China (13%)
8
Source: Department of Statistics, Malaysia and newsflows
*Share of total exports
Gross Export Growth
Annual change, %
22.0
29.9
38.3
11.8
2.8
1Q-22 2Q-22 3Q-22 4Q-22 1Q-23
E&E Non-E&E
Commodities Others
Gross exports (% yoy)
Headline and core inflation moderated in 1Q 2023
■ Headline inflation trended lower in line with moderating costs and supply conditions
■ Core inflation declined but remained elevated, reflecting resilient domestic demand
Note: Average of past inflation is calculated based on monthly frequency from Jan-11 to Dec-19
Source: Department of Statistics, Malaysia and Bank Negara Malaysia estimates
9
Malaysia Inflation
3.4
3.8
-1.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
Jan-21 Apr-21 Jul-21 Oct-21 Jan-22 Apr-22 Jul-22 Oct-22 Jan-23
Headline inflation Core inflation
2011-’19 Avg.:
Headline 2.2
Core 2.0
Annual Change (%)
(1Q-23: 3.6;
4Q-22: 3.9)
(1Q-23: 3.9;
4Q-22: 4.2)
1.3
1.8
2.8
3.1 2.9
0.6
0.7
0.7
0.5
0.6
0.5
0.4
0.4 0.2
1Q-22 2Q-22 3Q-22 4Q-22 1Q-23
Core Fresh food Fuel Other (non-fuel price admin)
Contribution (ppt)
Non-core
Breakdown of inflation by components
Source: Department of Statistics, Malaysia, Bank Negara Malaysia estimates
Core inflation remains at elevated levels amid firm demand conditions
Elevated underlying inflation has been more prolonged than
past episodes…
…partly owing to the strong recovery in domestic demand
2.0
2.5
3.0
3.5
4.0
4.5
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14
Mar-22 to present
Apr-11 to May-12
Jan-14 to Feb-15
Time taken for core inflation from exceeding 2% to revert to 2% (months)
Core inflation1, %
Selected Episodes of Core Inflation Exceeding 2%
139.5 133.1
167.1
Retail trade (RM bil)
2.2
0.2
1.5
Tourist arrivals (mil)Pre-pandemic
(2019)
2020-21 avg Latest
Retail trade volume (Index; seasonally adjusted)
Selected domestic demand indicators
Source: Department of Statistics, Malaysia and BNM estimates
10
4.5 4.5
9.3
Credit card F&B
Credit card spending on F&B (Volume; million units)
Tourist arrivals* (million)
Note: Latest retail trade and credit card spending data are as at 1Q-23; latest tourist arrivals data as at 4Q-22
Source: Bank Negara Malaysia, Department of Statistics Malaysia and Ministry of Tourism, Arts and Culture
▲ Higher global commodity prices due to
worsening geopolitical conflict or
adverse weather events
▲ Higher imported input costs due to
exchange rate developments
▲ Stronger-than-expected demand from
China
▲ Larger revisions to domestic subsidies
and price controls
Over the course of 2023, headline and core inflation to moderate but
remain elevated
Key drivers of headline inflation in 2023
11
2.8% to 3.8%
(2023f)
Elevated core inflation
Firm domestic demand and
improvement in labour market
Moderating global cost environment
Lower key commodity prices
Gradual subsidy rationalisation
Revision in electricity surcharge
for selected industry participants
Prevailing price controls and subsidies
On key necessity items
Upside risks
Downside risks
▼ Weaker global growth leading to more
subdued commodity prices
▼ Faster dissipation of domestic pent-up
demand from 2022
Source: Bank Negara Malaysia
1.0
1.5
2.0
2.5
3.0
3.5
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
May 2023:
3.00%
Overnight Policy Rate, OPR
%
Historical low
OPR level
At the current OPR level of 3.00%, the
monetary policy stance is slightly
accommodative and remains supportive
of the economy
Amid resilient domestic growth prospects,
the MPC judged that it was the right time to
further normalise the degree of monetary
accommodation
12
– With this decision, the MPC has withdrawn
the monetary stimulus intended to address
the COVID-19 crisis in promoting
economic recovery.
The OPR was further normalised to 3.00% at the May MPC meeting
Source: Bank Negara Malaysia
13
The OPR was normalised amid a resilient economy with firm demand conditions
The Malaysian economy continues to strengthen, driven by domestic demand, with
labour market conditions improving and households remaining resilient
Assessment of the impact from the past OPR adjustments shows no signs of excessive
tightening in the economy
While inflation has been moderating, it remains at elevated levels given the continued
price pressures amid firm demand
Prolonged low rates when economic growth is firm can have damaging effects on the
economy, including from financial imbalances
Ultimately, the goal of monetary policy in Malaysia is to achieve price stability and
sustainable economic growth over a longer term
Performance of Equity Indices (% Change)
Most regional equities including Malaysia fell due to lingering
uncertainties over global corporate earnings outlook
Updated
Domestic bond yields declined, in line with global bond yields’
movement amid monetary policy easing expectations in the US
US: United States; PH: the Philippines; UK: United Kingdom; MY: Malaysia; TH: Thailand; SG: Singapore;
KR: South Korea; CH: China; JP: Japan; ID: Indonesia.
Source: Bloomberg and Bursa Malaysia
*Regional countries include Indonesia, the Philippines, Singapore, South Korea and Thailand.
Source: Bank Negara Malaysia, ETP and Bloomberg
-34.0
-16.0
-35.5
-32.9
4.6
-40.7
-45
-40
-35
-30
-25
-20
-15
-10
-5
0
5
10
4Q22 1Q23
Malaysia Regional Average* US
Movement of 10-Year Local Currency Sovereign Bond Yields (in bps)
Domestic financial markets remained orderly despite global economic
uncertainties
7.2
5.0
14.4
-2.7
3.9
8.1
2.1
15.4
0.6
3.8
-4.9
-3.6
-1.0
-0.7
0.2
2.4
5.9
7.0
7.5
10.8
-10 0 10 20
MY
TH
PH
ID
SG
UK
CH
US
JP
KR
1Q23
4Q22
14
Ringgit continues to be driven by US dollar developments
Broadly stable performance of the ringgit despite shifting
sentiments surrounding the global economic outlook
Updated
US Dollar Index (DXY) and Selected Currencies against the US Dollar (%)
15
* The US dollar Index (DXY) is an index of the value of the US dollar against a basket of foreign currencies,
namely EUR (57.6%), JPY (13.6%), GBP (11.9%), CAD (9.1%), SEK (4.2%), and CHF (3.6%).
Source: Bank Negara Malaysia and Bloomberg
Performance of the Ringgit against Selected Currencies (%)
* NEER refers to the ringgit nominal effective exchange rate. It is an index measuring ringgit’s performance
against currencies of Malaysia’s major trading partners.
Source: Bank Negara Malaysia
Positive indicates
currency appreciation
Positive indicates
currency appreciation
Ringgit movements against trade partner currencies remain within
a typical range, reflecting global and country-specific factors
-2.4
-0.8
-0.1
0.1
0.8
1.1
1.3
1.3
1.4
2.3
2.6
2.9
4.1
-1.0
KRW
AUD
JPY
MYR
INR
TWD
THB
SGD
CNY
EUR
PHP
GBP
IDR
DXY*
-6.0 -4.0 -2.0 0.0 2.0 4.0 6.0 8.0
1Q 23 Year-to-date (09 May 23)
-3.8
-2.7
-2.4
-2.2
-1.3
-1.2
-1.2
-1.0
-0.7
0.1
0.2
0.9
2.5
-0.9
IDR
GBP
PHP
EUR
CNY
SGD
THB
TWD
INR
USD
JPY
AUD
KRW
NEER*
-8.0 -6.0 -4.0 -2.0 0.0 2.0 4.0 6.0
1Q 23 Year-to-date (09 May 23)
1 Data as at March 2023.
Source: Bank Negara Malaysia, Bank Negara Malaysia estimates
Resultant Total
Capital Ratio
Initial Total
Capital Ratio
The Mark-to-Market Impact on Banks' Total Capital Ratio
from Banks' Bonds Held at Amortised Cost
18.2%
* IRRBB refers to interest rate risk in the banking book
2 The sensitivity analysis conducted has incorporated the impact of mark-to-market losses if the bonds in
banks' AC portfolio are revalued to reflect a 200bps rate shock and the resultant losses are deducted from
banks’ capital (although Basel III capital rules do not require this).
17.1%
Spillovers from US banking sector stress have been limited
All banks in Malaysia are subject to stringent liquidity
and capital standards
Malaysian banks’ exposure to IRRBB* is manageable - Banks’
capital and liquidity levels remain resilient even if MTM losses
from AC bonds were to be deducted2
Minimum requirement: 8%
Liquidity Coverage Ratio1 High-Quality Liquid Assets1
157%
Total Capital Ratio1
RM763
bn
18.2%
16
*Comprises loans to households and non-financial corporations from the banking system and development financial institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers).
**Approval rate is calculated based on a four-quarter rolling average of loans applications with following status during the quarter: (loans approved + loans cancelled) / (loans approved + loans cancelled + loans rejected).
Note: Numbers may not add up due to rounding.
Source: Bank Negara Malaysia
Credit growth moderated as repayments outpaced disbursements
Credit to the private non-financial sector
moderated to 4.2% as at end-1Q 2023…
22
…as growth in loan repayments continued to outpace that of disbursements for both
businesses and households, with loan demand largely forthcoming
17
Business Loan Indicators
Annual change (%)
Household Loan Indicators
Annual change (%)
2.3 2.7 3.1 2.7 2.6
1.2
1.5
1.4
1.0
0.7
0.8
0.8
0.9
1.0
0.9
4.3
5.0
5.3
4.7
4.2
1Q 2022 2Q 2022 3Q 2022 4Q 2022 1Q 2023
Outstanding corporate bonds
Outstanding business loans
Outstanding household loans
Credit to the Private Non-Financial Sector
Credit to the Private Non-Financial Sector*
Annual change (%) / Cont. to growth (ppt)
11.1 12.1
16.0
27.2
5.3
7.8
Applications Disbursements Repayments
4Q-22 1Q-23
-12.6
10.3
21.5
7.3
15.2
21.6
Applications Disbursements Repayments
4Q-22 1Q-23
Approval rate**
1Q-23: 66.9%
4Q-22: 67.2%
2019: 60.4%
2019 quarterly
average
Approval rate**
1Q-23: 85.2%
4Q-22: 84.6%
2019: 81.0%
2019 quarterly
average
Note
1 Impairment ratio based on Stage 3 loans under MFRS 9.
2 Refers to the share of loans that have exhibited deterioration in credit risk, for which banks are required to set aside provisions based on lifetime expected losses under MFRS9. Stage 2 loans ratio was introduced with the
implementation of MFRS9 standards beginning 1 January 2018.
s
Source: Bank Negara Malaysia
The quality of household borrowings remains sound supported by improving
labour market conditions and the availability of assistance
Impairments remain low and within expectations among
borrowers from all income groups
221418
1.25
1.15
1.24
0.8
0.9
1.0
1.1
1.2
1.3
1.4
Jan-22 Mar-22 May-22 Jul-22 Sep-22 Nov-22 Jan-23 Mar-23
Overall <RM5k >RM5k
Household Sector: Impaired1 Ratio
(ratio, % of total household loans in banking system)
Axis does not start at 0
5.0
5.7
4.6
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
Jan-22 Mar-22 May-22 Jul-22 Sep-22 Nov-22 Jan-23 Mar-23
Overall <RM5k >RM5k
Household Sector: Stage 22 Loans Ratios
(ratio, % of total household loans in banking system)
Stage 2 loans also continue to decline as more borrowers
successfully transition out of repayment assistance programmes
Axis does not start at 0
% %
Decline reflects borrowers that
have resumed repayments
after exiting repayment assistance
programmes and maintained a
consistent track record (at least 6 –
12 months) of repayments.
2.07 2.06
1.35 1.34
0.00
0.50
1.00
1.50
2.00
2.50
Dec-22 Mar-23
Financial Assets-to-Debt Liquid Financial Assets-to-Debt
Note
1 Excludes credit card accounts
s
Source: Bank Negara Malaysia
41.9
48.2
45.2
53.4
62.6
49.7
58.1
51.8
54.8
46.6
37.4
50.3
<RM3k
RM3-5k
<RM5k
RM5-10k
>RM10k
Overall
Floating Rate Fixed Rate
Household borrowers are assessed to be generally resilient to upward
movements in borrowing costs
Lower-income borrowers have a larger share of fixed-rate
loan accounts which are unaffected by OPR changes
Household Sector: Share of Fixed-rate and Floating-rate Loan Accounts1
by Income Group (% proportion)
On aggregate, households continue to have ample financial
buffers to withstand shocks
Household Sector: Financial Asset Ratios
(Times of Debt)
19
75
34
125 123
0
20
40
60
80
100
120
140
Applications Approvals Disbursements Repayments
1Q-22 4Q-22 1Q-23 2018-19 quarterly average
Financing remains supportive of SME business activity in 1Q 2023
Financing disbursements and repayments continued to be sustained at high levels surpassing past trends
Note: Reflects loans from the banking system and development financial institutions (DFIs). The data reflects a standard 6-month data refresh conducted monthly, to take into account any historical data resubmission by FIs
Source: Bank Negara Malaysia
SME Financing Indicators
RM bil
20
(4.2%) (5.1%)
(%) growth rate
21
Core Inflation, % yoy
Unemployment Rate (% of labour force)
Employment Levels (million persons)
370.6
290.7
380.9
Pre-pandemic
(4Q 2019)
Trough (2Q 20) 1Q 2023
Real GDP Levels, RM bn
1.5
0.7
3.9
Pre-pandemic
(2019)
Trough (3Q 21) 1Q 2023
15.1
14.9
16.1
Pre-pandemic
(2019)
Trough (2Q 20) 1Q 2023
3.3
5.1
3.5
Pre-pandemic
(2019)
Peak (2Q 20) 1Q 2023
Gross Exports, RM bn
Travel Receipts, RM bn
258.2
210.6
354.6
Pre-pandemic
(4Q 2019)
Trough (2Q 20) 1Q 2023
19.4
0.0
12.3
Pre-pandemic
(4Q 2019)
Trough (2Q 20) 1Q 2023
Growth in 2023 is projected to expand between 4% and 5%,
anchored by firm domestic demand amid challenging global environment
Risk to growth outlook fairly balanced,
with downside risks emanating primarily from external developments, while
there are upside risks mainly from domestic factors
Summary
In 1Q 2023, the Malaysian economy grew by 5.6%, driven mainly
by private sector expenditure
Headline and core inflation are projected to average between
2.8% and 3.8% in 2023 with risk tilted to the upside
22
End of Presentation
Q & A
32
WIP
Questions & Answers
///9
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BANK NEGARA MALAYSIA
. ’//2, -
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7/A
B N OF MALAYSIA
§\§\W/
’?///A
Additional Information
Add. Info
1
Breakdown of 1Q GDP (% yoy)
Annual Change in GDP Growth by Component
1 Numbers do not add up due to rounding and exclusion of import duties component.
Source: Department of Statistics, Malaysia
Real GDP
(% YoY)
Share, %
(2022)
2022 2023
1Q 4Q 1Q
Domestic Demand
(Excluding Stocks)
93.1 4.4 6.8 4.6
Private Sector 75.5 4.3 7.8 5.6
Consumption 60.2 5.3 7.3 5.9
Investment 15.3 0.4 10.3 4.7
Public Sector 17.6 4.9 3.8 -0.3
Consumption 13.2 6.9 3.0 -2.2
Investment 4.4 -1.0 6.0 5.7
Net Exports of Goods
and Services
5.5 -28.9 23.0 54.4
Exports 74.6 12.3 8.6 -3.3
Imports 69.1 16.1 7.2 -6.5
Change in stocks, RM bil. 1.4 5.5 0.4 2.7
Real GDP 100.0 4.8 7.1 5.6
Real GDP
(% YoY)
Share1,
% (2022)
2022 2023
1Q 4Q 1Q
Services 58.3 6.4 9.1 7.3
Manufacturing 24.1 6.7 3.9 3.2
Agriculture 6.6 0.1 1.1 0.9
Mining and Quarrying 6.4 -2.2 6.3 2.4
Construction 3.5 -6.1 10.1 7.4
Real GDP 100.0 4.8 7.1 5.6
27
Note: p Preliminary, f Forecast
Source: Department of Statistics, Malaysia and Bank Negara Malaysia estimates
Growth underpinned by firm domestic demand amid
external headwinds
28
2023f: Domestic demand to remain the key driver of growth amid challenging
global environment
Upside risks
▲ Better-than-expected labour market
conditions
▲ Stronger-than-expected pick-up in
tourism activity
▲ Faster implementation of projects
including from re-tabled Budget 2023
Downside risks
▼ Sharp tightening in global financial market
conditions
▼ Further escalation of geopolitical conflicts
▼ Higher-than-expected inflation and input
costs domestically
Further improvement in employment and
income levels
Higher tourism activity
Continued implementation of multi-year
investment projects
Continued targeted policy measures
2023f: 4% to 5%
Risks to Malaysia’s growth outlook are fairly balanced
Add. Info
2
Financial account recorded a larger net outflow in the quarter
Higher outflows from portfolio investment account were partially offset by net inflows in direct and other investment account
Continued FDI inflows amid
lower DIA outflows
Continued net inflows in
other investment
Higher net outflows in
portfolio investment
Add. Info
3
*As per the IMF’s BPM5 classifications (i.e. directional basis).
Note: Numbers may not add up due to rounding.
Source: Department of Statistics, Malaysia and Bank Negara Malaysia
29
RM billion
2022 2023
4Q Year 1Q
Direct Investment -9.3 15.9 10.9
Direct Investment Abroad (DIA)* -28.5 -58.6 -1.1
Foreign Direct Investment (FDI)* 19.2 74.6 12.0
Portfolio Investment -26.7 -50.6 -33.3
Residents -15.0 -30.5 -16.3
Non-residents -11.7 -20.1 -17.0
Financial Derivatives -1.7 -2.2 -0.9
Other Investment 36.6 49.2 20.9
Financial Account Balance -1.1 12.4 -2.4
Adequate buffers to weather external shocks
Higher net creditor position … … and further supported by
L
External Assets Minus External Liabilities
(1Q 22 – 1Q 23)
Source: Department of Statistics, Malaysia and Bank Negara Malaysia
… with large net foreign-currency
assets …
3.2
3.0
3.9
3.0
4.7
0
2
4
6
8
0
20
40
60
80
100
120
1Q-22 2Q-22 3Q-22 4Q-22 1Q-23
Net IIP Position (LHS)
% of GDP (RHS)
RM bil % of GDP
Sustained foreign income
Continued current account surplus
reduces external financing
requirements
Sufficient international
reserves to facilitate
international transactions
… to finance 4.9* months of imports of
goods & services and is 1.0 time total
short-term external debt as at 28 April
2023
Add. Info
4
30
* Note: This reserves coverage ratio differ from that published in the
press statement on international reserves as at 28 April 2023 as it
reflects the latest 1Q 2023 data on imports of goods & services.
2,168.0
963.8
FCY Assets FCY Liabilities
FCY Denominated External Assets & Liabilities
(End-1Q 2023) (RM bil)
31
Liquidity tools are used to maintain sufficient day-to-day
liquidity, alleviate exigent liquidity needs and administer the
monetary policy target
Source: Bank Negara Malaysia
…while also ensuring orderly functioning of domestic FX
market and enhancing liquidity in the secondary government
bond market
The Bank has a comprehensive set of tools to address bank-specific or
system-wide liquidity shortfalls
1Q 2023 QB Box Article: “The Bank’s Liquidity Toolkit to Fulfil its Monetary Policy and Financial Stability Mandates”
Market liquidity
Foreign exchange (FX)
market
Regular OMO
(FX swaps)
Bilateral and
multilateral
arrangements
Government bond
market
Regular OMO
(bond repo)
ISCAP
ISCAP – Institutional Securities Custodian Program
Banking system liquidity
Financial stability and
payment systems efficiency
(liquidity provision)
Regular OMO
RENTAS
facilities
Special liquidity
facilities
Monetary policy
implementation
(liquidity management)
%
Regular OMO
Statutory reserve
requirement (SRR)
Standing facilities
OMO – Open market operations
Add. Info
5
OPR hike brought interest rate back to pre-pandemic levels
Policy rate (%) Inflation (% YoY) Real GDP (%)
GDP level***
vs 2019 (%)
End-2019 Mar 2023 End-2019** Mar 2023 2019 1Q 2023
Malaysia* 3.00 3.00 1.0 3.4 4.4 5.6 6.1
United
States*
1.75 5.00 2.3 5.0 2.3 1.6 5.0
Euro area* -0.50 3.00 1.3 6.9 1.6 1.3 2.4
China 2.09 1.70 4.5 0.7 6.0 4.5 13.8
Indonesia 5.00 5.75 2.7 5.0 5.0 5.0 7.4
Thailand 1.25 1.75 0.9 2.8 2.1 2.6 -1.5
*Policy rate for Malaysia, the United States and the euro area are as of May 2023. Note: Thailand real GDP (%) are as of 4Q 2022.
** Refers to December 2019
*** GDP levels refer to annual GDP as at 2022
Up arrow indicates latest value is higher than end 2019 value. Equal sign indicates no change while Down arrow indicates latest value is lower than end 2019 value.
Add. Info
6
32
33
box articles across our three publications
on various themes and topical issues18
Learn more at bnm.gov.my/AR2022
… and many more
Default Section
Slide 1
Part A: Developments
Slide 2: The global economy grew modestly in 1Q 2023
Slide 3: Malaysia’s GDP grew by 5.6% in 1Q 2023
Slide 4: Growth underpinned by private consumption and investments, and the services and manufacturing sectors
Slide 5: Lower current account surplus and FDI inflows
Part B: Outlook
Slide 6: Recent developments reaffirm outlook for 2023
Slide 7: Growth continues to be underpinned by domestic demand
Slide 8: Export growth slowed in 1Q 2023 following weaker external demand
Slide 9: Headline and core inflation moderated in 1Q 2023
Slide 10: Core inflation remains at elevated levels amid firm demand conditions
Slide 11: Over the course of 2023, headline and core inflation to moderate but remain elevated
Slide 12
Slide 13
Part C: Monetary and Financial Developments
Slide 14: Domestic financial markets remained orderly despite global economic uncertainties
Slide 15: Ringgit continues to be driven by US dollar developments
Slide 16
Slide 17: Credit growth moderated as repayments outpaced disbursements
Slide 18: The quality of household borrowings remains sound supported by improving labour market conditions and the availability of assistance
Slide 19: Household borrowers are assessed to be generally resilient to upward movements in borrowing costs
Slide 20: Financing remains supportive of SME business activity in 1Q 2023
Part D: Summary
Slide 21
Slide 22: Summary
Slide 23
Slide 24: Q & A
Slide 25
Additional Information
Slide 26
Slide 27: Breakdown of 1Q GDP (% yoy)
Slide 28
Slide 29: Financial account recorded a larger net outflow in the quarter
Slide 30: Adequate buffers to weather external shocks
Slide 31
Slide 32
Slide 33: 18
No
PRESS RELEASE
EMBARGO: For immediate release
ECONOMIC AND FINANCIAL DEVELOPMENTS IN MALAYSIA
IN THE FIRST QUARTER OF 2023
Press Conference Presentation Transcript
The global economy grew modestly in 1Q 2023
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “In the
first quarter of 2023, global growth was modest. The economic rebound in China
and resilient labour market offset the headwinds from the elevated inflation and
high interest rates.
“Headline inflation continued to moderate, but core inflation has persisted above
historical averages. Contraction in regional exports reflected slowing global
demand, ongoing shift in consumption from goods to services and downcycle in
E&E sector, particularly for consumer electronics.”
Malaysia’s GDP grew by 5.6% in 1Q 2023
Ketua Perangkawan Malaysia Dato’ Sri Dr. Mohd Uzir Mahidin berkata,
“Pada suku tahun pertama 2023, ekonomi Malaysia berkembang 5.6%,
disokong oleh peningkatan perbelanjaan isi rumah, aktivit pelaburan yang
berterusan, pasaran buruh yang bertambah baik dan aktiviti pelancongan yang
semakin rancak.
“Pertumbuhan mengikut sektor, pertumbuhan yang paling tinggi dicatatkan di
sektor perkhidmatan yang bertumbuh pada kadar 7.3%, sektor pembuatan
3.2%, sektor pertanian bertumbuh sebanyak 0.9%, sektor perlombongan
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
bertumbuh sebanyak 2.4% dan sektor pembinaan bertumbuh sebanyak 7.4%.
Justeru, kita lihat di sini kelima-lima sektor utama telah mencatatkan
pertumbuhan positif pada suku pertama 2023.
“Bagi terma pelarasan musim suku tahun ke tahun, KDNK meningkat sebanyak
0.9%.
Chief Statistician of Malaysia Dato’ Sri Dr. Mohd Uzir Mahidin said, “In the
first quarter of 2023, the Malaysian economy recorded a growth of 5.6%,
supported by further expansion of household spending, continued investment
activity, improving labour market conditions and higher tourism activities.
“On a seasonally adjusted quarter-on-quarter basis, GDP increased by 0.9%.”
Growth underpinned by private consumption and investments, and the
services and manufacturing sectors
Chief Statistician of Malaysia Dato’ Sri Dr. Mohd Uzir Mahidin said, “On the
demand side, growth was supported by private sector expenditure. Private
consumption growth was underpinned by firm labour market conditions and
policy measures. Spending continued to expand across both necessities and
discretionary items.
“Growth in private investment was supported mainly by structures. Turning to
the supply side, all sectors continued to expand. The services sector benefitted
from improvements in both consumer- and business-related subsectors,
supported by the continued recovery in tourist arrivals and progress
of construction activity.
“Meanwhile, growth in the manufacturing sector was supported by the consumer
cluster amid ongoing fulfilment of motor vehicle backlogs and continued growth
in the E&E cluster.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
“I would also like to highlight that, as a common practice, DOSM will periodically
revise the back series data of GDP components. In this current exercise, the
data has been revised from 2020 onwards, especially for exports and imports in
2022. So, please also take note of the revisions when you are reviewing and
commenting on the current performance of the economy.
Lower current account surplus and FDI inflows
Chief Statistician of Malaysia Dato’ Sri Dr. Mohd Uzir Mahidin said, “Let me
now turn to the balance of payments.
“For the first quarter of 2023, the current account recorded a lower surplus of
RM4.3 billion, or 1.0% of GDP. This was mainly on account of smaller goods
surplus, driven by moderation in external demand. In addition, primary income
registered a larger deficit during the quarter due mainly to lower investment
income accrued to Malaysians from investments abroad.
“Looking at the financial account, FDI recorded net inflows of RM12 billion during
the quarter from reinvested earnings and continued equity injections by foreign
investors. These investments were channelled mainly into the financial services
sub-sector as well as mining and manufacturing sectors. The FDI were primarily
from Mauritius, Switzerland and Hong Kong.”
“Before I hand over the presentation back to Gabenor, I would like to also inform
on our various initiatives done by DOSM. As you know, more timely data is
required by the country. For external trade, we normally release it four weeks
after the reference month. Now we will be releasing it two weeks after the
reference month. Presently we also release the GDP on a monthly basis and
we will continue to strengthen our role as the National Statistical Office and how
we use data to convince policymakers.
“So for the next quarter and onwards, we are going to release for the first time
the advance estimates of GDP. It will be released three weeks after the
reference quarter. So it will be more timely and the normal GDP will be continued
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
to be released as usual. Hence we can release more timely statistics that is
required for the country. This will bring our National Statistical Office at the same
level of advanced countries such as the US, UK, south Korea Taiwan and
Singapore where they also release the advance GDP estimate numbers.”
Recent developments reaffirm outlook for 2023
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “Recent
indicators suggest that the economy is on a firm track to expand between 4 to
5% in 2023. Malaysia is not at risk of a recession. On a seasonally adjusted
basis, the economy has exceeded its pre-pandemic levels (refers to 4Q 2019).
“The labour market continued to strengthen in 1Q 2023 and is expected to
remain supportive of domestic demand.
“The unemployment rate gradually improved towards pre-pandemic levels,
driven by steady employment growth, in tandem with the expansion in economic
activity. As mentioned during the release of the BNM’s Economic and Monetary
Review, the economy will approach full employment by the end of this year.
Growth continues to be underpinned by domestic demand
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said,
“Consumption indicators show continued growth in household spending. These
include high-frequency data such as the Index of Retail Trade and passenger
car sales, which continue to grow above its long-term average.
“On the investment front, existing large infrastructure projects are progressing
without major delays. These include the ECRL, LRT3 and Pan Borneo
Highway.”
Export growth slowed in 1Q 2023 following weaker external demand
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said,
“Turning to Malaysia’s external performance. In line with expectations, exports
growth moderated in 1Q 2023. Despite the slower growth, Malaysia’s exports
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
continue to be supported by our diversified products and trade partners. This
performance was further cushioned by improvement in exports of services
following further recovery in tourist arrivals.
“Even at the current rate of arrivals, we are likely to reach the forecasted number
of tourist arrivals of approximately 20 million in 2023. As indicated earlier, we
have chosen to be conservative in this figure. To the extent that international
tourism picks up, such as from higher tourist arrivals from China, there is some
upside to our services exports.”
Headline and core inflation moderated in 1Q 2023
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “Let me
spend a bit of time on inflation. In line with the easing cost environment, headline
inflation was lower, averaging at 3.6% for the quarter (4Q 2022: 3.9%). Much of
this downtrend was driven by supply factors, namely lower RON97 prices, which
contributed around two-thirds of the decline during the first quarter.
“While core inflation moderated to 3.9% during the quarter (4Q 2022: 4.2%) it
remains elevated relative to the historical norm of around 2.0%. Core inflation is
more indicative of underlying demand pressures. Prices on core items may stay
the same or increase, even as costs moderate, as demand remains strong. For
example, food away from home remains high at 8.9% compared to its long-term
average of 3.8% (4Q-23: 9.5%).
“So, as reflected in the slide, the decline in headline inflation is largely due to
cost factors. The blue bar which is core inflation, has come down, but only
slightly and at a much slower pace.”
Core inflation remains at elevated levels amid firm demand conditions
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “Of
note, current core inflation, as shown on the left chart, has remained high for
longer.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
“Even as costs have begun to moderate, the strong economic activity has
continued to generate demand-driven pressures which have kept core inflation
elevated. We can observe this beyond conventional demand indicators, such as
in retail trade and credit card spending data – or even when we go out to
shopping malls and restaurants and see long queues and traffic jams.”
Over the course of 2023, headline and core inflation to moderate but
remain elevated
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “Going
forward, headline and core inflation are expected to moderate over the course
of 2023, albeit remaining higher than pre-pandemic levels, averaging between
2.8% - 3.8% for the year as a whole.
“While cost pressures have eased in line with lower global commodity prices,
core inflation will remain at elevated levels amid firm demand conditions and
continuing improvements in the labour market. The outlook also accounts for
the gradual rationalisation of subsidies, particularly the revision in electricity
surcharge for selected industry participants.
“The balance of risk to inflation remains tilted to the upside, and is highly subject
to domestic policy changes on subsidies and price controls, financial market
developments, as well as risks to global commodity price from geopolitical
conflicts and adverse weather events like El Nino.”
The OPR was further normalised to 3.00% at the May MPC meeting
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “Let me
now explain our monetary policy. After four consecutive OPR adjustments in
2022, we decided to pause at our January and March MPC meetings this year
to take stock of the impact from the 100 basis points adjustment. Now, the latest
data shows that there are no signs of overtightening in the economy.
“With that, and amid resilient domestic growth prospects, the MPC judged that
it was the right time to further normalise the degree of monetary
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
accommodation. With this decision, the MPC has withdrawn the monetary
stimulus intended to address the COVID-19 crisis in promoting economic
recovery.
“At the current OPR leveI of 3.00%, the monetary policy stance is slightly
accommodative and remains supportive of the economy. The MPC will continue
to ensure that the monetary policy stance remains consistent with the outlook of
domestic inflation and growth.”
The OPR was normalised amid a resilient economy with firm demand
conditions
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “I know
there’s been a lot of interest in the recent monetary policy adjustment, so let me
take a moment to explain further on why we increased the OPR at our recent
MPC meeting.
“First, I want to make it clear that the Malaysian economy continues to
strengthen. GDP has already exceeded pre-pandemic levels, unemployment
has also fallen, and households remain resilient. And as I mentioned, after the
four consecutive OPR adjustments in 2022, we do not see any signs of
excessive tightening – for example in consumption or investment. Recall that
we have been on a normalisation path since last year, and so taking all these
together, we judged that it was the right time to further recalibrate our monetary
policy in line with the stronger economy.
“Let me also emphasise that while inflation has been moderating lately, the
greater expansion in our economic activity and firm domestic demand continue
to contribute to price pressures, keeping inflation at elevated levels. This has
been the trend in many countries. In some cases, monetary policy was slow to
react, resulting in the need for policy interest rates to be raised more quickly and
aggressively. We do not want to be in that situation, so we must be prudent.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
“We also wanted to avoid a situation of keeping interest rates too low for too
long, especially when economic growth is firm, because this could lead to higher
inflation in the future and also the risks of financial imbalances. Let me be clear
that we are not seeing any signs of financial imbalances now. But as history has
shown, prolonged low rates that are not aligned to the health of the economy
can have damaging effects, such as overspending and overborrowing, which
could push up prices even more. When that happens, all of us will be affected,
especially the poor and vulnerable.
“I must correct the misperception that we want growth to be slower. That is not
true. Rather, this decision will help to ensure that we continue to grow
sustainably, and that inflation is kept in check.”
Domestic financial markets remained orderly despite global economic
uncertainties
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “On
financial markets, adjustments in the domestic financial markets have remained
orderly despite concerns that the global economic outlook could moderate. In
particular, banking sector stress in major advanced economies have contributed
to global bond yields declining further towards the end of the quarter amid
monetary policy easing expectations in the US.
“Despite the external uncertainties, investors’ outlook for emerging markets
including Malaysia has remained broadly intact. For Malaysia, domestic
government bond yields declined during the quarter, in line with the movement
in global bond yields.
“The regional equity market has been more affected by lingering uncertainties
over the potential impact of global economic risks on the outlook for global
corporate earnings. As a result, most regional equities including the FBM KLCI
declined during the quarter.”
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Ringgit continues to be driven by US dollar developments
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “So far
in 2023, the US dollar has moved in tandem with shifting investor sentiments
towards global economic uncertainties. The year-to-date decline in the US dollar
index (DXY) has been modest at 1.9%.
“Reflecting these global developments, the ringgit has exhibited two-way
movements. On aggregate, the ringgit’s performance has remained broadly
stable.
“While the ringgit began the year on an appreciating trend, this was short-lived
due to the re-surfacing of expectations for further tightening of US monetary
policy. Subsequently, amid concerns over the banking sector stress in major
economies, the ringgit reversed some of its depreciation against the US dollar.
Year-to-date, the ringgit has depreciated by 0.6% against the US dollar.
“The Bank will continue to monitor developments and ensure orderly market
conditions to support financial intermediation and economic activity.”
Spillovers from US banking sector stress have been limited
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said,
“Spillovers from US banking sector stress have been limited. Unlike in the US,
all banks in Malaysia are subject to the same stringent prudential requirements
that are consistent with Basel 3. Their business model and funding profiles are
also different. Collectively, these factors continue to provide a high degree of
resilience for banks in Malaysia against market and liquidity stress.
“This resilience is supported by high levels of high-quality liquid assets (HQLA)
to meet stressed cash outflows. These are largely in the form of placements with
the Bank and government bonds that can be pledged with the Bank amounting
to over RM760 bil as at March 2023, to meet any additional liquidity needs
(HQLA as at Mar 2023: RM763.0 bil).
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
“The banking system’s exposure to interest rate risk in the banking book also
remains manageable. Under our capital rules, all marked-to-market losses in
banks’ bond holdings, except for those held at Amortised Cost are deducted
from capital. An internal simulation concludes that even if we were to revalue
the bonds that are held as amortised cost, banks’ capital would only reduce by
1.1 percentage point and the resultant capital ratio is still well above the
regulatory minimum.”
Credit growth moderated as repayments outpaced disbursements
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said,
“Turning to credit conditions, credit to the private non-financial sector moderated
to 4.2% as at end of the first quarter. This was due mainly to slower growth in
outstanding loans, as loan repayments growth continued to outpace that of
disbursements. Outstanding corporate bonds also grew at a more moderate
pace.
“Notwithstanding this, the demand for loans has remained forthcoming and has
been supported by sustained approvals.
“Of note, the higher growth in business loan applications during the quarter was
driven by investment loans, primarily for construction and the purchase of non-
residential properties.
“In the household segment, growth in loan applications was broad-based across
most types of loans, reflecting sustained demand, particularly in loans for the
purchase of houses and cars.”
The quality of household borrowings remains sound supported by
improving labour market conditions and the availability of assistance
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “In line
with improving incomes, the quality of household borrowings remains sound.
This has also been supported by prudent loan affordability assessments by
banks, which help to ensure that borrowers have buffers against rising costs.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Impairments remain low and within expectations among borrowers from all
income groups.
“Majority of the borrowers exiting repayment assistance programmes continue
to be able to maintain good repayment behaviour with limited signs of difficulties.
In line with this, leading credit risk indicators such as the Stage 2 loans continue
to improve suggesting further impairments are likely to be manageable.
“I wish to stress that it is not true that the increase in the OPR has caused a rise
in bankruptcies. None of the figures are showing that.”
Household borrowers are assessed to be generally resilient to upward
movements in borrowing costs
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “On
aggregate, households continue to hold financial assets in excess of debt, which
enables them to manage higher borrowing costs. Lower-income borrowers also
have a larger share of fixed-rate loan accounts, which are not affected by
changes in the OPR.
“Of course, we acknowledge that some household borrowers may continue to
face financial distress. Assistance continues to be available for such borrowers
in the form of customised repayment programmes from banks and AKPK to
ensure that borrowers can sustainably service their loans over the longer-term.”
Financing remains supportive of SME business activity in 1Q 2023
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said,
“Financing activity by banks and DFIs to SMEs remained robust, especially with
disbursements sustained above quarterly trends seen before the pre-pandemic
times.
“SMEs’ repayment capacity, on aggregate, also remained intact, and it
continued to outpace disbursements.”
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Malaysia’s economy continue to show strength
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “I want
to reiterate that the economy is no longer in crisis and has in fact continued to
gain strength.
“This prognosis is borne by most economic indicators. The critical ones are
shown here. The IMF, World Bank, ADB, AMRO, international and local analysts
have also arrived at the same conclusion.
“We acknowledge there are pockets of segments and sectors that need help
due to their circumstances. Help remains available for those in need.
“With all these conditions, it is timely, necessary and warranted, that monetary
policy is recalibrated to make sure that we continue to be on a sustainable
growth path.”
Summary
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “Let me
now conclude.
“The Malaysian economy expanded by 5.6% in the first quarter this year, driven
mainly by private sector expenditure. Growth is projected to average 4% to 5%
for 2023 as a whole, anchored by firm domestic demand.
“Risks to the growth outlook are fairly balanced. The downside risks stem
primarily from external factors. Meanwhile, upside risks are mainly from
domestic factors, such as stronger-than-expected tourism activity and
implementation of projects.
“Meanwhile, on inflation, both headline and core are expected to average
between 2.8% and 3.8% for the year.”
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Bank Negara Malaysia
12 May 2023
| Press Release |
09 May 2023 | International Reserves of Bank Negara Malaysia as at 28 April 2023 | https://www.bnm.gov.my/-/international-reserves-of-bank-negara-malaysia-as-at-28-april-2023 | null | null |
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International Reserves of Bank Negara Malaysia as at 28 April 2023
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International Reserves of Bank Negara Malaysia as at 28 April 2023
Embargo :
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1500 on
Tuesday, 9 May 2023
9 May 2023
The international reserves of Bank Negara Malaysia amounted to USD114.4 billion as at 28 April 2023. The reserves position is sufficient to finance 5.1 months of imports of goods and services[1], and is 1.0 time of the total short-term external debt.
[1] Under the previous import coverage measure, reserves are sufficient to finance 6.3 months of retained imports of goods. For more information on the new indicator, please refer to the article on “Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to Imports of Goods and Services” in BNM’s Quarterly Bulletin for the Fourth Quarter of 2021 publication, page 27, which can be accessed at Quarterly Bulletin 4Q 2021.
Related Assets
BNM Statement of Assets & Liabilities - 28 April 2023
Bank Negara Malaysia
9 May 2023
© Bank Negara Malaysia, 2023. All rights reserved.
| null | Press Release |
08 May 2023 | Indonesia and Malaysia Announce the Commercial Launch of the Cross-Border QR Payment Linkage | https://www.bnm.gov.my/-/qrpay_launch_bnm_bi_en | null | null |
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Indonesia and Malaysia Announce the Commercial Launch of the Cross-Border QR Payment Linkage
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Indonesia and Malaysia Announce the Commercial Launch of the Cross-Border QR Payment Linkage
Embargo :
For immediate release
Not for publication or broadcast before
1130 on
Monday, 8 May 2023
8 May 2023
Bank Indonesia (BI) and Bank Negara Malaysia (BNM) today announced the commercial launch of the Indonesia-Malaysia cross-border QR payment linkage. The commercial launch of this linkage follows from the successful completion of the pilot phase of the linkage announced on 27 January 2022.
The commercial launch of this linkage sees the number of participating financial institutions[1] which include non-banks increase. This will enable more Indonesians and Malaysians to make instant retail payments in either country by scanning Quick Response Code Indonesian Standard (QRIS) or DuitNow QR codes[2] at physical stores or online merchants using services offered by participating financial institutions.
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Mohd Yunus said, “ASEAN is more connected now than ever. Many more users from Malaysia and Indonesia will benefit from a secure, more seamless and more efficient experience to make and receive cross-border payments. This in turn has significant potential to boost economic activities, including tourism spending in our two countries. The payment linkage will also help expand markets for some businesses and facilitate increased settlements in local currency, thereby improving financial outcomes. The QR payment linkage between Malaysia and Indonesia complements a growing network of bilateral payment linkages within ASEAN that will contribute towards a more vibrant ASEAN and further development of the region as a centre of growth.”
Governor of Bank Indonesia, Mr. Perry Warjiyo said on this occasion, “Cross-border QR payment linkage between Indonesia and Malaysia is concrete evidence of strengthened cooperation on Regional Payment Connectivity to promote faster, cheaper, more transparent and more inclusive cross-border payments, particularly for the benefits of micro, small and medium enterprises. The linkage aligns with the G20 initiative in establishing the Roadmap for Enhancing Cross Border Payments, and serves as a significant deliverable of Indonesia’s chairmanship of the ASEAN in 2023, as well represents another milestone of the Indonesian Payment System Blueprint 2025. It provides more options for users in cross-border payment transactions and serves as a key to improve efficiency, to promote digital economy and financial inclusion in the region, as well as to maintain macroeconomic stability by promoting more extensive use of local currency for bilateral transactions under the Local Currency Transaction Framework.”
The QR payment linkage will strengthen the close economic ties between Indonesia and Malaysia. It would support a more inclusive and stronger post-pandemic economic recovery. As international travel gathers momentum, the payment linkage is expected to not only provide travellers greater convenience, but also benefit the tourism and retail sector of both economies.
The successful launch of the payment linkage is a result of close industry collaboration championed by BI and BNM which worked closely with the Indonesian Payment System Association (which include its member payment system operators in Indonesia[3]), PayNet[4], and participating financial institutions. BI and BNM welcome participation from more financial institutions to further expand the cross-border payments ecosystem.
Bank Indonesia
Bank Negara Malaysia
8 May 2023
[1] Participating financial institutions from Indonesia (as issuers): Bank Sinarmas, DANA, Bank Permata, Bank CIMB Niaga, Bank Pembangunan Daerah (BPD) Bali, Bank Syariah Indonesia, LinkAja, Bank Central Asia, Ottocash, Bank Mega.
Participating financial institutions from Indonesia (as acquirers): Bank Sinarmas, DANA, Bank Permata, Bank CIMB Niaga, Bank Pembangunan Daerah (BPD) Bali, LinkAja, Bank Central Asia, Ottocash, Bank Mega, Bank Mandiri, Bank Rakyat Indonesia, Bank Negara Indonesia, Gopay, OVO, BPD Jawa Barat & Banten, Bank Nationalnobu, Bank Danamon Indonesia, Bank Maybank Indonesia, BPD DIY, BPD Provinsi Jawa Timur, i-Saku, BPD Sumatera Barat, BPD Sulawesi Selatan dan Sulawesi Barat, Artha Graha International, Bank DKI, BPD Jambi, BPD NTT, Astrapay, GV e-money, BPD Kalimantan Timur dan Kalimantan Utara, DOKU, BPD Kalimantan Barat, BPD NTB Syariah, BPD Papua, Bank Multiartha Sentosa, BPD Lampung, Kaspro, Dipay, Bank Neo Commerce, PACcash, Paprika Multi Media, Bank DBS Indonesia, Virgoku, BPD Jawa Tengah, ShopeePay Indonesia.
Participating financial institutions from Malaysia (as issuers): CIMB Bank Berhad, Hong Leong Bank Berhad, Malayan Banking Berhad, Public Bank Berhad, TNG Digital Sdn. Bhd.
Participating financial institutions from Malaysia (as acquirers): AmBank Malaysia Berhad, Boost, Hong Leong Bank Berhad, Malayan Banking Berhad, Public Bank Berhad, Razer Merchant Services Sdn. Bhd., TNG Digital Sdn. Bhd., United Overseas Bank Malaysia Berhad.
[2] Quick Response Code Indonesian Standard (QRIS) and DuitNow QR are the national QR code solutions for Indonesia and Malaysia, respectively. It allows merchants to accept payments from customers of different participating financial institutions (banks and payment system providers) using a unified QR code.
[3] Payment system operators from Indonesia are Alto, Artajasa, Jalin and Rintis.
[4] Payments Network Malaysia Sdn. Bhd. (PayNet) is Malaysia’s retail payment system operator that operates DuitNow QR.
Bank Negara Malaysia
8 May 2023
© Bank Negara Malaysia, 2023. All rights reserved.
| null | Press Release |
03 May 2023 | Monetary Policy Statement | https://www.bnm.gov.my/-/monetary-policy-statement-03052023 | https://www.bnm.gov.my/documents/20124/10559867/MPS_Snapshot_2023_05_en.pdf | null |
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Monetary Policy Statement
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Monetary Policy Statement
Embargo :
For immediate release
Not for publication or broadcast before
1500 on
Wednesday, 3 May 2023
3 May 2023
At its meeting today, the Monetary Policy Committee (MPC) of Bank Negara Malaysia decided to increase the Overnight Policy Rate (OPR) by 25 basis points to 3.00 percent. The ceiling and floor rates of the corridor of the OPR are correspondingly increased to 3.25 percent and 2.75 percent, respectively.
The global economy continues to be driven by resilient domestic demand supported by strong labour market conditions, and a stronger-than-expected rebound of China’s economy. Nevertheless, the global economy continues to be weighed down by elevated cost pressures and higher interest rates. Headline inflation continued to moderate, but core inflation has persisted above historical averages. For most central banks, the monetary policy stance is likely to remain tight. The growth outlook remains subject to downside risks, mainly from an escalation of geopolitical tensions, higher-than-anticipated inflation outturns, and a sharp tightening in financial market conditions including from further stress in the banking sector.
For the Malaysian economy, latest developments point towards further expansion in economic activity in the first quarter of 2023 after the strong performance in 2022. While exports are expected to moderate, growth in 2023 will be driven by domestic demand. Household spending remains resilient, underpinned by better labour market conditions as unemployment continues to decline to pre-pandemic levels. The pickup in tourist arrivals is expected to lift tourism-related activities. Further progress of multi-year infrastructure projects will support investment activity. Domestic financial conditions also remain conducive to financial intermediation, with no signs of excessive tightening affecting consumption and investment activities. Risks to the domestic growth outlook are relatively balanced. Upside risks mainly emanate from domestic factors such as stronger-than-expected tourism activity and implementation of projects including those from the re-tabled Budget 2023, while downside risks stem from weaker-than-expected global growth and more volatile global financial market conditions.
As expected, headline inflation trended lower in recent months on account of moderating cost factors. Both headline and core inflation are expected to moderate over the course of 2023, averaging between 2.8% – 3.8%. However, core inflation will remain at elevated levels amid firm demand conditions. Existing price controls and fuel subsidies will continue to partly contain the extent of upward pressures to inflation. The balance of risk to the inflation outlook is tilted to the upside and remains highly subject to any changes to domestic policy including on subsidies and price controls, financial market developments, as well as global commodity prices.
With the domestic growth prospects remaining resilient, the MPC judges that it is timely to further normalise the degree of monetary accommodation. With this decision, the MPC has withdrawn the monetary stimulus intended to address the COVID-19 crisis in promoting economic recovery. In light of the continued strength of the Malaysian economy, the MPC also recognises the need to ensure that the stance of monetary policy is appropriate to prevent the risk of future financial imbalances. At the current level, the monetary policy stance is slightly accommodative and remains supportive of the economy. The MPC will continue to ensure that the monetary policy stance remains consistent with the outlook of domestic inflation and growth.
See also:
Monetary Policy Statement (MPS) Snapshot: May 2023
Frequently Asked QuestionsBank Negara Malaysia
3 May 2023
© Bank Negara Malaysia, 2023. All rights reserved.
|
No
PRESS RELEASE
EMBARGO: For immediate release
ECONOMIC AND FINANCIAL DEVELOPMENTS IN MALAYSIA
IN THE FIRST QUARTER OF 2023
Press Conference Presentation Transcript
The global economy grew modestly in 1Q 2023
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “In the
first quarter of 2023, global growth was modest. The economic rebound in China
and resilient labour market offset the headwinds from the elevated inflation and
high interest rates.
“Headline inflation continued to moderate, but core inflation has persisted above
historical averages. Contraction in regional exports reflected slowing global
demand, ongoing shift in consumption from goods to services and downcycle in
E&E sector, particularly for consumer electronics.”
Malaysia’s GDP grew by 5.6% in 1Q 2023
Ketua Perangkawan Malaysia Dato’ Sri Dr. Mohd Uzir Mahidin berkata,
“Pada suku tahun pertama 2023, ekonomi Malaysia berkembang 5.6%,
disokong oleh peningkatan perbelanjaan isi rumah, aktivit pelaburan yang
berterusan, pasaran buruh yang bertambah baik dan aktiviti pelancongan yang
semakin rancak.
“Pertumbuhan mengikut sektor, pertumbuhan yang paling tinggi dicatatkan di
sektor perkhidmatan yang bertumbuh pada kadar 7.3%, sektor pembuatan
3.2%, sektor pertanian bertumbuh sebanyak 0.9%, sektor perlombongan
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
bertumbuh sebanyak 2.4% dan sektor pembinaan bertumbuh sebanyak 7.4%.
Justeru, kita lihat di sini kelima-lima sektor utama telah mencatatkan
pertumbuhan positif pada suku pertama 2023.
“Bagi terma pelarasan musim suku tahun ke tahun, KDNK meningkat sebanyak
0.9%.
Chief Statistician of Malaysia Dato’ Sri Dr. Mohd Uzir Mahidin said, “In the
first quarter of 2023, the Malaysian economy recorded a growth of 5.6%,
supported by further expansion of household spending, continued investment
activity, improving labour market conditions and higher tourism activities.
“On a seasonally adjusted quarter-on-quarter basis, GDP increased by 0.9%.”
Growth underpinned by private consumption and investments, and the
services and manufacturing sectors
Chief Statistician of Malaysia Dato’ Sri Dr. Mohd Uzir Mahidin said, “On the
demand side, growth was supported by private sector expenditure. Private
consumption growth was underpinned by firm labour market conditions and
policy measures. Spending continued to expand across both necessities and
discretionary items.
“Growth in private investment was supported mainly by structures. Turning to
the supply side, all sectors continued to expand. The services sector benefitted
from improvements in both consumer- and business-related subsectors,
supported by the continued recovery in tourist arrivals and progress
of construction activity.
“Meanwhile, growth in the manufacturing sector was supported by the consumer
cluster amid ongoing fulfilment of motor vehicle backlogs and continued growth
in the E&E cluster.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
“I would also like to highlight that, as a common practice, DOSM will periodically
revise the back series data of GDP components. In this current exercise, the
data has been revised from 2020 onwards, especially for exports and imports in
2022. So, please also take note of the revisions when you are reviewing and
commenting on the current performance of the economy.
Lower current account surplus and FDI inflows
Chief Statistician of Malaysia Dato’ Sri Dr. Mohd Uzir Mahidin said, “Let me
now turn to the balance of payments.
“For the first quarter of 2023, the current account recorded a lower surplus of
RM4.3 billion, or 1.0% of GDP. This was mainly on account of smaller goods
surplus, driven by moderation in external demand. In addition, primary income
registered a larger deficit during the quarter due mainly to lower investment
income accrued to Malaysians from investments abroad.
“Looking at the financial account, FDI recorded net inflows of RM12 billion during
the quarter from reinvested earnings and continued equity injections by foreign
investors. These investments were channelled mainly into the financial services
sub-sector as well as mining and manufacturing sectors. The FDI were primarily
from Mauritius, Switzerland and Hong Kong.”
“Before I hand over the presentation back to Gabenor, I would like to also inform
on our various initiatives done by DOSM. As you know, more timely data is
required by the country. For external trade, we normally release it four weeks
after the reference month. Now we will be releasing it two weeks after the
reference month. Presently we also release the GDP on a monthly basis and
we will continue to strengthen our role as the National Statistical Office and how
we use data to convince policymakers.
“So for the next quarter and onwards, we are going to release for the first time
the advance estimates of GDP. It will be released three weeks after the
reference quarter. So it will be more timely and the normal GDP will be continued
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
to be released as usual. Hence we can release more timely statistics that is
required for the country. This will bring our National Statistical Office at the same
level of advanced countries such as the US, UK, south Korea Taiwan and
Singapore where they also release the advance GDP estimate numbers.”
Recent developments reaffirm outlook for 2023
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “Recent
indicators suggest that the economy is on a firm track to expand between 4 to
5% in 2023. Malaysia is not at risk of a recession. On a seasonally adjusted
basis, the economy has exceeded its pre-pandemic levels (refers to 4Q 2019).
“The labour market continued to strengthen in 1Q 2023 and is expected to
remain supportive of domestic demand.
“The unemployment rate gradually improved towards pre-pandemic levels,
driven by steady employment growth, in tandem with the expansion in economic
activity. As mentioned during the release of the BNM’s Economic and Monetary
Review, the economy will approach full employment by the end of this year.
Growth continues to be underpinned by domestic demand
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said,
“Consumption indicators show continued growth in household spending. These
include high-frequency data such as the Index of Retail Trade and passenger
car sales, which continue to grow above its long-term average.
“On the investment front, existing large infrastructure projects are progressing
without major delays. These include the ECRL, LRT3 and Pan Borneo
Highway.”
Export growth slowed in 1Q 2023 following weaker external demand
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said,
“Turning to Malaysia’s external performance. In line with expectations, exports
growth moderated in 1Q 2023. Despite the slower growth, Malaysia’s exports
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
continue to be supported by our diversified products and trade partners. This
performance was further cushioned by improvement in exports of services
following further recovery in tourist arrivals.
“Even at the current rate of arrivals, we are likely to reach the forecasted number
of tourist arrivals of approximately 20 million in 2023. As indicated earlier, we
have chosen to be conservative in this figure. To the extent that international
tourism picks up, such as from higher tourist arrivals from China, there is some
upside to our services exports.”
Headline and core inflation moderated in 1Q 2023
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “Let me
spend a bit of time on inflation. In line with the easing cost environment, headline
inflation was lower, averaging at 3.6% for the quarter (4Q 2022: 3.9%). Much of
this downtrend was driven by supply factors, namely lower RON97 prices, which
contributed around two-thirds of the decline during the first quarter.
“While core inflation moderated to 3.9% during the quarter (4Q 2022: 4.2%) it
remains elevated relative to the historical norm of around 2.0%. Core inflation is
more indicative of underlying demand pressures. Prices on core items may stay
the same or increase, even as costs moderate, as demand remains strong. For
example, food away from home remains high at 8.9% compared to its long-term
average of 3.8% (4Q-23: 9.5%).
“So, as reflected in the slide, the decline in headline inflation is largely due to
cost factors. The blue bar which is core inflation, has come down, but only
slightly and at a much slower pace.”
Core inflation remains at elevated levels amid firm demand conditions
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “Of
note, current core inflation, as shown on the left chart, has remained high for
longer.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
“Even as costs have begun to moderate, the strong economic activity has
continued to generate demand-driven pressures which have kept core inflation
elevated. We can observe this beyond conventional demand indicators, such as
in retail trade and credit card spending data – or even when we go out to
shopping malls and restaurants and see long queues and traffic jams.”
Over the course of 2023, headline and core inflation to moderate but
remain elevated
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “Going
forward, headline and core inflation are expected to moderate over the course
of 2023, albeit remaining higher than pre-pandemic levels, averaging between
2.8% - 3.8% for the year as a whole.
“While cost pressures have eased in line with lower global commodity prices,
core inflation will remain at elevated levels amid firm demand conditions and
continuing improvements in the labour market. The outlook also accounts for
the gradual rationalisation of subsidies, particularly the revision in electricity
surcharge for selected industry participants.
“The balance of risk to inflation remains tilted to the upside, and is highly subject
to domestic policy changes on subsidies and price controls, financial market
developments, as well as risks to global commodity price from geopolitical
conflicts and adverse weather events like El Nino.”
The OPR was further normalised to 3.00% at the May MPC meeting
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “Let me
now explain our monetary policy. After four consecutive OPR adjustments in
2022, we decided to pause at our January and March MPC meetings this year
to take stock of the impact from the 100 basis points adjustment. Now, the latest
data shows that there are no signs of overtightening in the economy.
“With that, and amid resilient domestic growth prospects, the MPC judged that
it was the right time to further normalise the degree of monetary
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
accommodation. With this decision, the MPC has withdrawn the monetary
stimulus intended to address the COVID-19 crisis in promoting economic
recovery.
“At the current OPR leveI of 3.00%, the monetary policy stance is slightly
accommodative and remains supportive of the economy. The MPC will continue
to ensure that the monetary policy stance remains consistent with the outlook of
domestic inflation and growth.”
The OPR was normalised amid a resilient economy with firm demand
conditions
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “I know
there’s been a lot of interest in the recent monetary policy adjustment, so let me
take a moment to explain further on why we increased the OPR at our recent
MPC meeting.
“First, I want to make it clear that the Malaysian economy continues to
strengthen. GDP has already exceeded pre-pandemic levels, unemployment
has also fallen, and households remain resilient. And as I mentioned, after the
four consecutive OPR adjustments in 2022, we do not see any signs of
excessive tightening – for example in consumption or investment. Recall that
we have been on a normalisation path since last year, and so taking all these
together, we judged that it was the right time to further recalibrate our monetary
policy in line with the stronger economy.
“Let me also emphasise that while inflation has been moderating lately, the
greater expansion in our economic activity and firm domestic demand continue
to contribute to price pressures, keeping inflation at elevated levels. This has
been the trend in many countries. In some cases, monetary policy was slow to
react, resulting in the need for policy interest rates to be raised more quickly and
aggressively. We do not want to be in that situation, so we must be prudent.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
“We also wanted to avoid a situation of keeping interest rates too low for too
long, especially when economic growth is firm, because this could lead to higher
inflation in the future and also the risks of financial imbalances. Let me be clear
that we are not seeing any signs of financial imbalances now. But as history has
shown, prolonged low rates that are not aligned to the health of the economy
can have damaging effects, such as overspending and overborrowing, which
could push up prices even more. When that happens, all of us will be affected,
especially the poor and vulnerable.
“I must correct the misperception that we want growth to be slower. That is not
true. Rather, this decision will help to ensure that we continue to grow
sustainably, and that inflation is kept in check.”
Domestic financial markets remained orderly despite global economic
uncertainties
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “On
financial markets, adjustments in the domestic financial markets have remained
orderly despite concerns that the global economic outlook could moderate. In
particular, banking sector stress in major advanced economies have contributed
to global bond yields declining further towards the end of the quarter amid
monetary policy easing expectations in the US.
“Despite the external uncertainties, investors’ outlook for emerging markets
including Malaysia has remained broadly intact. For Malaysia, domestic
government bond yields declined during the quarter, in line with the movement
in global bond yields.
“The regional equity market has been more affected by lingering uncertainties
over the potential impact of global economic risks on the outlook for global
corporate earnings. As a result, most regional equities including the FBM KLCI
declined during the quarter.”
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Ringgit continues to be driven by US dollar developments
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “So far
in 2023, the US dollar has moved in tandem with shifting investor sentiments
towards global economic uncertainties. The year-to-date decline in the US dollar
index (DXY) has been modest at 1.9%.
“Reflecting these global developments, the ringgit has exhibited two-way
movements. On aggregate, the ringgit’s performance has remained broadly
stable.
“While the ringgit began the year on an appreciating trend, this was short-lived
due to the re-surfacing of expectations for further tightening of US monetary
policy. Subsequently, amid concerns over the banking sector stress in major
economies, the ringgit reversed some of its depreciation against the US dollar.
Year-to-date, the ringgit has depreciated by 0.6% against the US dollar.
“The Bank will continue to monitor developments and ensure orderly market
conditions to support financial intermediation and economic activity.”
Spillovers from US banking sector stress have been limited
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said,
“Spillovers from US banking sector stress have been limited. Unlike in the US,
all banks in Malaysia are subject to the same stringent prudential requirements
that are consistent with Basel 3. Their business model and funding profiles are
also different. Collectively, these factors continue to provide a high degree of
resilience for banks in Malaysia against market and liquidity stress.
“This resilience is supported by high levels of high-quality liquid assets (HQLA)
to meet stressed cash outflows. These are largely in the form of placements with
the Bank and government bonds that can be pledged with the Bank amounting
to over RM760 bil as at March 2023, to meet any additional liquidity needs
(HQLA as at Mar 2023: RM763.0 bil).
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
“The banking system’s exposure to interest rate risk in the banking book also
remains manageable. Under our capital rules, all marked-to-market losses in
banks’ bond holdings, except for those held at Amortised Cost are deducted
from capital. An internal simulation concludes that even if we were to revalue
the bonds that are held as amortised cost, banks’ capital would only reduce by
1.1 percentage point and the resultant capital ratio is still well above the
regulatory minimum.”
Credit growth moderated as repayments outpaced disbursements
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said,
“Turning to credit conditions, credit to the private non-financial sector moderated
to 4.2% as at end of the first quarter. This was due mainly to slower growth in
outstanding loans, as loan repayments growth continued to outpace that of
disbursements. Outstanding corporate bonds also grew at a more moderate
pace.
“Notwithstanding this, the demand for loans has remained forthcoming and has
been supported by sustained approvals.
“Of note, the higher growth in business loan applications during the quarter was
driven by investment loans, primarily for construction and the purchase of non-
residential properties.
“In the household segment, growth in loan applications was broad-based across
most types of loans, reflecting sustained demand, particularly in loans for the
purchase of houses and cars.”
The quality of household borrowings remains sound supported by
improving labour market conditions and the availability of assistance
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “In line
with improving incomes, the quality of household borrowings remains sound.
This has also been supported by prudent loan affordability assessments by
banks, which help to ensure that borrowers have buffers against rising costs.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Impairments remain low and within expectations among borrowers from all
income groups.
“Majority of the borrowers exiting repayment assistance programmes continue
to be able to maintain good repayment behaviour with limited signs of difficulties.
In line with this, leading credit risk indicators such as the Stage 2 loans continue
to improve suggesting further impairments are likely to be manageable.
“I wish to stress that it is not true that the increase in the OPR has caused a rise
in bankruptcies. None of the figures are showing that.”
Household borrowers are assessed to be generally resilient to upward
movements in borrowing costs
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “On
aggregate, households continue to hold financial assets in excess of debt, which
enables them to manage higher borrowing costs. Lower-income borrowers also
have a larger share of fixed-rate loan accounts, which are not affected by
changes in the OPR.
“Of course, we acknowledge that some household borrowers may continue to
face financial distress. Assistance continues to be available for such borrowers
in the form of customised repayment programmes from banks and AKPK to
ensure that borrowers can sustainably service their loans over the longer-term.”
Financing remains supportive of SME business activity in 1Q 2023
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said,
“Financing activity by banks and DFIs to SMEs remained robust, especially with
disbursements sustained above quarterly trends seen before the pre-pandemic
times.
“SMEs’ repayment capacity, on aggregate, also remained intact, and it
continued to outpace disbursements.”
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Malaysia’s economy continue to show strength
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “I want
to reiterate that the economy is no longer in crisis and has in fact continued to
gain strength.
“This prognosis is borne by most economic indicators. The critical ones are
shown here. The IMF, World Bank, ADB, AMRO, international and local analysts
have also arrived at the same conclusion.
“We acknowledge there are pockets of segments and sectors that need help
due to their circumstances. Help remains available for those in need.
“With all these conditions, it is timely, necessary and warranted, that monetary
policy is recalibrated to make sure that we continue to be on a sustainable
growth path.”
Summary
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “Let me
now conclude.
“The Malaysian economy expanded by 5.6% in the first quarter this year, driven
mainly by private sector expenditure. Growth is projected to average 4% to 5%
for 2023 as a whole, anchored by firm domestic demand.
“Risks to the growth outlook are fairly balanced. The downside risks stem
primarily from external factors. Meanwhile, upside risks are mainly from
domestic factors, such as stronger-than-expected tourism activity and
implementation of projects.
“Meanwhile, on inflation, both headline and core are expected to average
between 2.8% and 3.8% for the year.”
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Bank Negara Malaysia
12 May 2023
| Press Release |
28 Apr 2023 | Monetary and Financial Developments in March 2023 | https://www.bnm.gov.my/-/monetary-and-financial-developments-in-march-2023 | https://www.bnm.gov.my/documents/20124/10475226/i_en.pdf | null |
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Monetary and Financial Developments in March 2023
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Monetary and Financial Developments in March 2023
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28 Apr 2023
Headline inflation declined to 3.4% in March
Headline inflation declined to 3.4% in March (February: 3.7%) due mainly to lower inflation for fuel, air fares and selected food items, in line with the easing global commodity prices.
Core inflation[1] moderated slightly to 3.8% during the month (February: 3.9%), driven largely by lower inflation for food away from home.
Robust growth in volume index driven by retail and motor vehicles
The Index of Wholesale and Retail Trade (IOWRT) expanded by 10.6% in February 2023 (January: 8.5%).
The higher growth was driven mainly by retail sales in non-specialised stores (e.g., department stores) followed by continued strength in purchases of motor vehicles amid the ongoing fulfilment of backlog orders.
On a month-on-month seasonally adjusted basis, the index accelerated by 5.5% (January: 0.2%).
Growth in credit to the private non-financial sector[2],[3] moderated
Credit to the private non-financial sector grew by 4.2% as at end-March (February: 4.5%), attributed to slower growth in credit to businesses (3.2%; February: 3.7%).
While growth in outstanding corporate bonds moderated (4.4%; February: 5.5%), outstanding business loan growth was sustained at 2.4% (February: 2.4%). This was supported by the continued growth in both working capital (2.2%; February: 1.9%) and investment-related loans (4.3%; February: 4.2%).
Outstanding household loan growth remained broadly stable (5.2%; February: 5.3%), supported by growth in loans for car purchases (8.7%; February: 7.6%). This was amid weaker loan growth for the purchase of securities (-6.9%; February: -3.3%).
Domestic financial market conditions remained orderly
In March, global financial markets were affected by the emergence of banking sector stress in some major economies. As spillovers were contained thus far due to early action by authorities, investors’ risk appetite for emerging market currencies and bonds improved.
In line with the performance of regional currencies, the ringgit appreciated by 1.7% against the US dollar. Conditions in the domestic bond market also remained stable.
The FBM KLCI declined by 2.2% during the month.
Banks maintained strong liquidity and funding positions to support intermediation
Banks continued to record healthy liquidity buffers with the aggregate Liquidity Coverage Ratio at 157.4% (February: 152.7%).
The aggregate loan-to-fund ratio remained stable at 81.9% (February: 81.6%).
Asset quality in the banking system remained intact
Overall gross and net impaired loans ratios increased slightly to 1.8% (February: 1.8%) and 1.2% (February: 1.1%), respectively.
Loan loss coverage ratio (including regulatory reserves) continues to record a prudent level of 110.5% of impaired loans, with total provisions accounting for 1.7% of total loans.
See also: Monthly Highlights [PDF]
[1] Core inflation is computed by excluding price-volatile and price-administered items.
[2] Comprises loans to households and non-financial corporations from the banking system and development financial institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers).
[3] Starting with the publication of December 2022 Monthly Highlights and Statistics (MHS), this series was introduced to enhance the quality of financing data. This new data series is available in the MHS Table 2.18. Related Assets
Monthly Highlights & Statistics in March 2023
Bank Negara Malaysia
28 April 2023
© Bank Negara Malaysia, 2023. All rights reserved.
|
Monthly Highlights May 2023
Monthly Highlights
Headline inflation declined further to 2.8% in May
May 2023
Contribution to Inflation
ppt. contribution %, yoy
1 Core inflation is computed by excluding price-volatile and price-administered items.
Source: Department of Statistics, Malaysia & Bank Negara Malaysia estimates
• Headline inflation moderated to 2.8% (April 2023:
3.3%). This decline was largely due to non-core
CPI components, particularly lower inflation for
fuel (-0.2 percentage points, ppt) and fresh food
(-0.1ppt).
• Core inflation also declined slightly to 3.5% (April
2023: 3.6%) amid lower inflation for
communication services.
3.3
2.8
3.6 3.5
0.00
2.00
4.00
0.0
2.0
4.0
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Food & non-alcohol (29.5%) Housing & utilities (23.8%)
Transport (14.6%) Others (32.1%)
Headline inflation (RHS) Core inflation¹ (RHS)
1.6
5.1
4.6
0
1
2
3
4
5
6
7
May-22 Sep-22 Jan-23 May-23
Business loans
Household loans
Corporate bonds
Annual growth (%)
Credit to the Private Non-Financial Sector1,2
1
Growth in credit to the private non-financial sector improved in May
1 Comprises loans to households and non-financial corporations from the
banking system and development financial institutions (DFIs), and corporate
bonds issued by non-financial corporations (including short-term papers).
2 Starting with the publication of December 2022 Monthly Highlights and
Statistics (MHS), this series was introduced to enhance the quality of
financing data. This new data series is available in the MHS Table 2.18.
Source: Bank Negara Malaysia
Contribution to growth (ppt)
• Credit to the private non-financial sector expanded
by 4.0% as at end-May (April 2023: 3.7%), driven
mainly by higher growth in credit to businesses
(2.8%; April 2023: 2.5%).
• Outstanding corporate bonds grew by 4.6% (April
2023: 4.4%), while outstanding business loans
expanded by 1.6% (April 2023: 1.0%). The higher
business loan growth reflected improvement in
loans for both working capital and investments to
SMEs and non-SMEs.
• In the household segment, outstanding loan
growth was sustained at 5.1% (April 2023: 5.0%),
supported by higher growth across most loan
purposes. Of note, household loan growth
continued to be driven by loans for the purchase of
houses and cars, which grew by 7.0% and 8.4%,
respectively (April 2023: 6.8% and 8.0%).
2.7 2.6 2.5 2.6
0.7 0.7 0.3 0.5
1.1 0.9
0.9 1.0
4.5 4.2
3.7 4.0
Feb-23 Mar-23 Apr-23 May-23
Corporate Bonds
Business Loans
Household Loans
Credit to the Private Non-
Financial Sector
Index of wholesale and retail trade growth moderated in April
Source: Department of Statistics, Malaysia
• The Index of Wholesale and Retail Trade
(IOWRT) expanded more moderately by 4.7% in
April 2023 (March 2023: 9.4%). The lower growth
was due mainly to the decline in the motor vehicle
segment.
• However, the retail segment continued to record a
double-digit growth of 10.0% (March 2023:
13.8%), supported by sales in non-specialised and
other specialised stores1.
• On a month-on-month seasonally adjusted basis,
the index increased at a faster pace of 6.5%
(March 2023: -0.9%).
1 Other goods in specialised stores includes clothing, footwear,
pharmaceuticals, cosmetics, watches, jewellery and optical goods.
10.6
9.4
4.7
-2
3
8
13
18
23
28
33
Apr-22 Jun-22 Aug-22 Oct-22 Dec-22 Feb-23 Apr-23
ppt, %yoy
Motor vehicles Retail Wholesale
Index of Wholesale and Retail Trade
Monthly Highlights
2
May 2023
Domestic financial markets were largely affected by external factors
Financial Market Performance in May 2023
-18.0
-0.5
-1.1
-3.0
-2.0
-3.4
10-year MGS
(bps, mom)
Equity
(%, mom)
Ringgit
(%, mom)
-20 -15 -10 -5 0
May-23 Apr-23
Note: The exchange rate data is the noon-rate in the Kuala Lumpur Interbank Foreign Exchange Market
1Regional countries comprise Singapore, Thailand, Philippines, Indonesia, and Korea
Source: Bank Negara Malaysia, Bursa Malaysia
• Global investors maintained a risk-off approach
throughout May, as concerns over the impact of the
US debt ceiling crisis and the weaker-than-
expected rebound in China’s economy weighed on
global financial markets.
• As a result, the ringgit depreciated against the US
dollar by 3.4% (regional1 average: -1.2%). Similarly,
the FBM KLCI declined by 2.0% (regional1 average:
-1.3%).
• Nonetheless, the 10-year MGS yields decreased
slightly by 3 basis points, supported by non-resident
inflows into the domestic bond market.
Banks maintained strong liquidity and funding positions to support intermediation
• Banks continued to record healthy liquidity buffers
with the aggregate Liquidity Coverage Ratio at
151.2% (April 2023: 154.3%).
• The aggregate loan-to-fund ratio remained stable at
81.8% (April 2023: 82.1%).
Source: Bank Negara Malaysia
Banking System Liquidity and Funding Ratios
81.8
151.2
0
40
80
120
160
70
75
80
85
90
95
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A
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M
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2
3
% %
Liquidity Coverage Ratio (RHS)
Loan-to-Fund Ratio
Asset quality in the banking system remained intact
Banking System Asset Quality
Source: Bank Negara Malaysia
• Overall gross and net impaired loans ratios
remained broadly unchanged at 1.80% (April
2023: 1.78%) and 1.10% (April 2023: 1.10%),
respectively.
• Loan loss coverage ratio (including regulatory
reserves) remained at a prudent level of 114.1%
of impaired loans, with total provisions accounting
for 1.7% of total loans.
%
1.8
1.1
1.7
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1.0
1.5
2.0
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Gross Impaired Loans Ratio
Total Provisions to Total Loans Ratio
Net Impaired Loans Ratio
April 2023 Monthly Highlights
Slide 1
Slide 2
| Press Release |
28 Apr 2023 | Detailed Disclosure of International Reserves as at end-March 2023 | https://www.bnm.gov.my/-/detailed-disclosure-of-international-reserves-as-at-end-march-2023-1 | null | null |
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Detailed Disclosure of International Reserves as at end-March 2023
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Detailed Disclosure of International Reserves as at end-March 2023
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28 Apr 2023
In accordance with the International Monetary Fund (IMF) Special Data Dissemination Standard (SDDS) format, the detailed breakdown of international reserves provides forward-looking information on the size, composition and usability of reserves and other foreign currency assets, and the expected and potential future inflows and outflows of foreign exchange of the Federal Government and Bank Negara Malaysia over the next 12-month period.
The detailed breakdown of international reserves based on the SDDS format is shown in Tables I, II, III and IV.
As shown in Table I, official reserve assets amounted to USD115,490.1 million, while other foreign currency assets amounted to USD1,001.5 million as at end-March 2023.
As shown in Table II, for the next 12 months, the pre-determined short-term outflows of foreign currency loans, securities and deposits, which include among others, scheduled repayment of external borrowings by the Government and the maturity of foreign currency Bank Negara Interbank Bills, amounted to USD15,311.3 million. The net short forward positions amounted to USD25,728.5 million, reflecting the management of ringgit liquidity in the money market. In line with the practice adopted since April 2006, the data excludes projected foreign currency inflows arising from interest income and the drawdown of project loans. Projected foreign currency inflows amount to USD2,251.8 million in the next 12 months.
As shown in Table III, the only contingent short-term net drain on foreign currency assets are Government guarantees of foreign currency debt due within one year, amounting to USD371.0 million. There are no foreign currency loans with embedded options, no undrawn, unconditional credit lines provided by or to other central banks, international organisations, banks and other financial institutions. Bank Negara Malaysia also does not engage in foreign currency options vis-à-vis ringgit.
Overall, the detailed breakdown of international reserves under the IMF SDDS format indicates that as at end-March 2023, Malaysia’s international reserves remain usable. Related Assets
International Reserves and Foreign Currency Liquidity (31 March 2023 )
Bank Negara Malaysia
28 April 2023
© Bank Negara Malaysia, 2023. All rights reserved.
| null | Press Release |
25 Apr 2023 | International Reserves of Bank Negara Malaysia as at 14 April 2023 | https://www.bnm.gov.my/-/international-reserves-of-bnm-as-at-14-april-2023-1 | https://www.bnm.gov.my/documents/20124/6118085/qb2021q4_en_box_imports.pdf | null |
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International Reserves of Bank Negara Malaysia as at 14 April 2023
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International Reserves of Bank Negara Malaysia as at 14 April 2023
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25 Apr 2023
The international reserves of Bank Negara Malaysia amounted to USD115.9 billion as at 14 April 2023. The reserves position is sufficient to finance 5.1 months of imports of goods and services[1], and is 1.1 times of the total short-term external debt.
[1] Under the previous import coverage measure, reserves is sufficient to finance 6.4 months of retained imports of goods. For more information on the new indicator, please refer to the article on “Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to Imports of Goods and Services” in BNM’s Quarterly Bulletin for the Fourth Quarter of 2021 publication, page 27, which can be accessed at Quarterly Bulletin 4Q 2021. Related Assets
BNM Statement of Assets & Liabilities - 14 April 2023
Bank Negara Malaysia
25 April 2023
© Bank Negara Malaysia, 2023. All rights reserved.
|
Monthly Highlights
Headline inflation declined to 3.4% in March
March 2023
1
3.7 3.4
3.9 3.8
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2.00
4.00
0.0
2.0
4.0
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Food & non-alcohol (29.5%) Housing & utilities (23.8%)
Transport (14.6%) Others (32.1%)
Headline inflation (RHS) Core inflation¹ (RHS)
Contribution to Inflation
ppt. contribution %, yoy
1 Core inflation is computed by excluding price-volatile and price-administered items.
Source: Department of Statistics, Malaysia & Bank Negara Malaysia estimates
• Headline inflation declined to 3.4% in March
(February: 3.7%) due mainly to lower inflation for
fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation moderated slightly to 3.8% during
the month (February: 3.9%), driven largely by
lower inflation for food away from home.
1
Robust growth in volume index driven by retail and motor vehicles
Index of Wholesale and Retail Trade
Source: Department of Statistics, Malaysia
• The Index of Wholesale and Retail Trade
(IOWRT) expanded by 10.6% in February 2023
(January: 8.5%).
• The higher growth was driven mainly by retail
sales in non-specialised stores (e.g., department
stores) followed by continued strength in
purchases of motor vehicles amid the ongoing
fulfilment of backlog orders.
• On a month-on-month seasonally adjusted basis,
the index accelerated by 5.5% (January: 0.2%).
9.5 8.510.6
0
10
20
30
40
Feb-
22
Mar-
22
Apr-
22
May-
22
Jun-
22
Jul-
22
Aug-
22
Sep-
22
Oct-
22
Nov-
22
Dec-
22
Jan-
23
Feb-
23
ppt, %yoy
Motor vehicles Retail Wholesale
2.4
5.2
4.4
0
1
2
3
4
5
6
7
Mar-22 Jul-22 Nov-22 Mar-23
Business loans
Household loans
Corporate bonds
Annual growth (%)
Growth in credit to the private non-financial sector moderated
1 Comprises loans to households and non-financial corporations from the
banking system and development financial institutions (DFIs), and corporate
bonds issued by non-financial corporations (including short-term papers).
2 Starting with the publication of December 2022 Monthly Highlights and
Statistics (MHS), this series was introduced to enhance the quality of
financing data. This new data series is available in the MHS Table 2.18.
Source: Bank Negara Malaysia
2.7 2.6 2.7 2.6
1.0 0.6 0.7 0.7
1.0
1.1 1.1 0.9
4.7 4.3 4.5 4.2
Dec-22 Jan-23 Feb-23 Mar-23
Corporate Bonds
Business Loans
Household Loans
Credit to the Private Non-
Financial Sector
Contribution to growth (ppt)
• Credit to the private non-financial sector grew by
4.2% as at end-March (February: 4.5%), attributed
to slower growth in credit to businesses (3.2%;
February: 3.7%).
• While growth in outstanding corporate bonds
moderated (4.4%; February : 5.5%), outstanding
business loan growth was sustained at 2.4%
(February: 2.4%). This was supported by the
continued growth in both working capital (2.2%;
February: 1.9%) and investment-related loans
(4.3%; February: 4.2%).
• Outstanding household loan growth remained
broadly stable (5.2%; February: 5.3%), supported
by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan
growth for the purchase of securities (-6.9%;
February: -3.3%).
Credit to the Private Non-Financial Sector1,2
Monthly Highlights
March 2023
Domestic financial market conditions remained orderly
Financial Market Performance in March 2023
Source: Bank Negara Malaysia, Bursa Malaysia
Note: The exchange rate data is the noon-rate in the Kuala Lumpur Interbank Foreign Exchange Market
11.0
-2.1
-5.3
0.0
-2.2
1.7
10-year MGS
(bps, mom)
Equity
(%, mom)
Ringgit
(%, mom)
-10 -5 0 5 10 15
Mar-23
Feb-23
• In March, global financial markets were affected by
the emergence of banking sector stress in some
major economies. As spillovers were contained thus
far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds
improved.
• In line with the performance of regional currencies,
the ringgit appreciated by 1.7% against the US
dollar. Conditions in the domestic bond market
also remained stable.
• The FBM KLCI declined by 2.2% during the month.
2
Banks maintained strong liquidity and funding positions to support intermediation
Source: Bank Negara Malaysia
Banking System Liquidity and Funding Ratios
81.9
157.4
0
40
80
120
160
70
75
80
85
90
95
M
a
r
2
2
A
p
r
2
2
M
a
y
2
2
J
u
n
2
2
J
u
l
2
2
A
u
g
2
2
S
e
p
2
2
O
c
t
2
2
N
o
v
2
2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
% %
Liquidity Coverage Ratio (RHS)
Loan-to-Fund Ratio
Asset quality in the banking system remained intact
Banking System Asset Quality
Source: Bank Negara Malaysia
• Overall gross and net impaired loans ratios
increased slightly to 1.8% (February-23: 1.8%) and
1.2% (February-23: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory
reserves) continue to record a prudent level of
110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
%
1.8
1.2
1.7
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
M
a
r
2
2
A
p
r
2
2
M
a
y
2
2
J
u
n
2
2
J
u
l
2
2
A
u
g
2
2
S
e
p
2
2
O
c
t
2
2
N
o
v
2
2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
Gross Impaired Loans Ratio
Total Provisions to Total Loans Ratio
Net Impaired Loans Ratio
• Banks continued to record healthy liquidity buffers
with the aggregate Liquidity Coverage Ratio at
157.4% (February-23: 152.7%).
• The aggregate loan-to-fund ratio remained stable at
81.9% (February-23: 81.6%).
PRESS RELEASE
Ref. No.: 04/23/05 EMBARGO: Not for publication or
broadcast before 1500 hours on
Friday, 28 April 2023
Monthly Highlights – March 2023
Headline inflation declined to 3.4% in March
• Headline inflation declined to 3.4% in March (February: 3.7%) due mainly
to lower inflation for fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation1 moderated slightly to 3.8% during the month
(February: 3.9%), driven largely by lower inflation for food away from
home.
Robust growth in volume index driven by retail and motor vehicles
• The Index of Wholesale and Retail Trade (IOWRT) expanded by 10.6%
in February 2023 (January: 8.5%).
• The higher growth was driven mainly by retail sales in non-specialised
stores (e.g., department stores) followed by continued strength in
purchases of motor vehicles amid the ongoing fulfilment of backlog
orders.
• On a month-on-month seasonally adjusted basis, the index accelerated
by 5.5% (January: 0.2%).
1 Core inflation is computed by excluding price-volatile and price-administered items.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Growth in credit to the private non-financial sector2,3 moderated
• Credit to the private non-financial sector grew by 4.2% as at end-March
(February: 4.5%), attributed to slower growth in credit to businesses
(3.2%; February: 3.7%).
• While growth in outstanding corporate bonds moderated (4.4%;
February: 5.5%), outstanding business loan growth was sustained at
2.4% (February: 2.4%). This was supported by the continued growth in
both working capital (2.2%; February: 1.9%) and investment-related
loans (4.3%; February: 4.2%).
• Outstanding household loan growth remained broadly stable (5.2%;
February: 5.3%), supported by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan growth for the purchase of
securities (-6.9%; February: -3.3%).
Domestic financial market conditions remained orderly
• In March, global financial markets were affected by the emergence of
banking sector stress in some major economies. As spillovers were
contained thus far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds improved.
• In line with the performance of regional currencies, the ringgit
appreciated by 1.7% against the US dollar. Conditions in the domestic
bond market also remained stable.
• The FBM KLCI declined by 2.2% during the month.
Banks maintained strong liquidity and funding positions to support
intermediation
• Banks continued to record healthy liquidity buffers with the aggregate
Liquidity Coverage Ratio at 157.4% (February: 152.7%).
2 Comprises loans to households and non-financial corporations from the banking system and development financial
institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers).
3 Starting with the publication of December 2022 Monthly Highlights and Statistics (MHS), this series was introduced
to enhance the quality of financing data. This new data series is available in the MHS Table 2.18.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
• The aggregate loan-to-fund ratio remained stable at 81.9%
(February: 81.6%).
Asset quality in the banking system remained intact
• Overall gross and net impaired loans ratios increased slightly to 1.8%
(February: 1.8%) and 1.2% (February: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory reserves) continues to
record a prudent level of 110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
Bank Negara Malaysia
28 April 2023
20230428_BNM Monthly Highlights-March_en
Slide 1
Slide 2
20230428_BNM PR_Monthly Highlights-Mar 2023_eng
| Press Release |
20 Apr 2023 | BNM to co-host virtual AML/CFT Hackathon 2023 to help crack down on financial crime | https://www.bnm.gov.my/-/amlcft-hackathon23 | null | null |
Reading:
BNM to co-host virtual AML/CFT Hackathon 2023 to help crack down on financial crime
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42
BNM to co-host virtual AML/CFT Hackathon 2023 to help crack down on financial crime
Embargo :
For immediate release
Not for publication or broadcast before
1000 on
Thursday, 20 April 2023
20 Apr 2023
Bank Negara Malaysia (BNM), in partnership with the Financial Intelligence Consultative Group (FICG), will be co-hosting the AML/CFT Hackathon 2023 from 1 to 28 June 2023 to develop digital solutions to help combat financial crime.
Bank Negara Malaysia Deputy Governor Marzunisham Omar said, “Global challenges require global solutions. Financial crime is a global issue, and we all have a role to play in maintaining the integrity of the financial system. We are pleased to continue our long-term partnership with FICG through this search for creative solutions to curb financial crimes, particularly scams, from talented individuals across the region.”
The AML/CFT Hackathon 2023, which will be held virtually, will feature workshops and mentoring sessions run by experts in cybersecurity and anti-money laundering/counter-financing of terrorism (AML/CFT). Participants will work in teams to prototype innovative digital solutions to specific problem statements identified by the organisers, which reflect real-world pain points in combating serious financial crimes today. Pitches will be evaluated in three separate tracks to reflect different categories of participants: public sector (e.g., law enforcement agencies), private sector (e.g., reporting institutions, fintech companies) and open category (e.g., freelance developers, students).
Participants stand a chance to win up to USD5,000 as well as an opportunity to present their winning prototypes to senior financial intelligence officials from across the region.
The AML/CFT Hackathon 2023 builds upon past efforts by BNM and Australian Transaction Reports and Analysis Centre (AUSTRAC), and is now in its third instalment following the International FIU Codeathon in 2017 and the ASEAN-Australia Codeathon in 2018. Prototypes developed include, amongst others, enhancement of AML/CFT compliance and suspicious matter reporting by applying artificial intelligence.
Those interested in participating may register at amlhackathon.com before 28 May 2023, and stay up to date by following the AML Hackathon 2023 Facebook page at facebook.com/amlhackathon.
Bank Negara Malaysia
20 April 2023
© Bank Negara Malaysia, 2023. All rights reserved.
| null | Press Release |
07 Apr 2023 | International Reserves of Bank Negara Malaysia as at 31 March 2023 | https://www.bnm.gov.my/-/international-reserves-of-bank-negara-malaysia-as-at-31-march-2023 | https://www.bnm.gov.my/documents/20124/6118085/qb2021q4_en_box_imports.pdf | null |
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International Reserves of Bank Negara Malaysia as at 31 March 2023
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6
International Reserves of Bank Negara Malaysia as at 31 March 2023
Embargo :
For immediate release
Not for publication or broadcast before
1500 on
Friday, 7 April 2023
7 Apr 2023
The international reserves of Bank Negara Malaysia amounted to USD115.5 billion as at 31 March 2023. The reserves level has taken into account the quarterly foreign exchange revaluation changes. The reserves position is sufficient to finance 5.1 months of imports of goods and services[1], and is 1.1 times of the total short-term external debt.
[1] Under the previous import coverage measure, reserves are sufficient to finance 6.4 months of retained imports of goods. For more information on the new indicator, please refer to the article on “Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to Imports of Goods and Services” in BNM’s Quarterly Bulletin for the Fourth Quarter of 2021 publication, page 27, which can be accessed at bnm.gov.my/-/quarterly-bulletin-4q-2021 Related Assets
BNM Statement of Assets & Liabilities - 31 March 2023
Bank Negara Malaysia
7 April 2023
© Bank Negara Malaysia, 2023. All rights reserved.
|
Monthly Highlights
Headline inflation declined to 3.4% in March
March 2023
1
3.7 3.4
3.9 3.8
0.00
2.00
4.00
0.0
2.0
4.0
J
a
n
-2
2
F
e
b
-2
2
M
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2
2
A
p
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2
2
M
a
y
-2
2
J
u
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-2
2
J
u
l-
2
2
A
u
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-2
2
S
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p
-2
2
O
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t-
2
2
N
o
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-2
2
D
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-2
2
J
a
n
-2
3
F
e
b
-2
3
M
a
r-
2
3
Food & non-alcohol (29.5%) Housing & utilities (23.8%)
Transport (14.6%) Others (32.1%)
Headline inflation (RHS) Core inflation¹ (RHS)
Contribution to Inflation
ppt. contribution %, yoy
1 Core inflation is computed by excluding price-volatile and price-administered items.
Source: Department of Statistics, Malaysia & Bank Negara Malaysia estimates
• Headline inflation declined to 3.4% in March
(February: 3.7%) due mainly to lower inflation for
fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation moderated slightly to 3.8% during
the month (February: 3.9%), driven largely by
lower inflation for food away from home.
1
Robust growth in volume index driven by retail and motor vehicles
Index of Wholesale and Retail Trade
Source: Department of Statistics, Malaysia
• The Index of Wholesale and Retail Trade
(IOWRT) expanded by 10.6% in February 2023
(January: 8.5%).
• The higher growth was driven mainly by retail
sales in non-specialised stores (e.g., department
stores) followed by continued strength in
purchases of motor vehicles amid the ongoing
fulfilment of backlog orders.
• On a month-on-month seasonally adjusted basis,
the index accelerated by 5.5% (January: 0.2%).
9.5 8.510.6
0
10
20
30
40
Feb-
22
Mar-
22
Apr-
22
May-
22
Jun-
22
Jul-
22
Aug-
22
Sep-
22
Oct-
22
Nov-
22
Dec-
22
Jan-
23
Feb-
23
ppt, %yoy
Motor vehicles Retail Wholesale
2.4
5.2
4.4
0
1
2
3
4
5
6
7
Mar-22 Jul-22 Nov-22 Mar-23
Business loans
Household loans
Corporate bonds
Annual growth (%)
Growth in credit to the private non-financial sector moderated
1 Comprises loans to households and non-financial corporations from the
banking system and development financial institutions (DFIs), and corporate
bonds issued by non-financial corporations (including short-term papers).
2 Starting with the publication of December 2022 Monthly Highlights and
Statistics (MHS), this series was introduced to enhance the quality of
financing data. This new data series is available in the MHS Table 2.18.
Source: Bank Negara Malaysia
2.7 2.6 2.7 2.6
1.0 0.6 0.7 0.7
1.0
1.1 1.1 0.9
4.7 4.3 4.5 4.2
Dec-22 Jan-23 Feb-23 Mar-23
Corporate Bonds
Business Loans
Household Loans
Credit to the Private Non-
Financial Sector
Contribution to growth (ppt)
• Credit to the private non-financial sector grew by
4.2% as at end-March (February: 4.5%), attributed
to slower growth in credit to businesses (3.2%;
February: 3.7%).
• While growth in outstanding corporate bonds
moderated (4.4%; February : 5.5%), outstanding
business loan growth was sustained at 2.4%
(February: 2.4%). This was supported by the
continued growth in both working capital (2.2%;
February: 1.9%) and investment-related loans
(4.3%; February: 4.2%).
• Outstanding household loan growth remained
broadly stable (5.2%; February: 5.3%), supported
by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan
growth for the purchase of securities (-6.9%;
February: -3.3%).
Credit to the Private Non-Financial Sector1,2
Monthly Highlights
March 2023
Domestic financial market conditions remained orderly
Financial Market Performance in March 2023
Source: Bank Negara Malaysia, Bursa Malaysia
Note: The exchange rate data is the noon-rate in the Kuala Lumpur Interbank Foreign Exchange Market
11.0
-2.1
-5.3
0.0
-2.2
1.7
10-year MGS
(bps, mom)
Equity
(%, mom)
Ringgit
(%, mom)
-10 -5 0 5 10 15
Mar-23
Feb-23
• In March, global financial markets were affected by
the emergence of banking sector stress in some
major economies. As spillovers were contained thus
far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds
improved.
• In line with the performance of regional currencies,
the ringgit appreciated by 1.7% against the US
dollar. Conditions in the domestic bond market
also remained stable.
• The FBM KLCI declined by 2.2% during the month.
2
Banks maintained strong liquidity and funding positions to support intermediation
Source: Bank Negara Malaysia
Banking System Liquidity and Funding Ratios
81.9
157.4
0
40
80
120
160
70
75
80
85
90
95
M
a
r
2
2
A
p
r
2
2
M
a
y
2
2
J
u
n
2
2
J
u
l
2
2
A
u
g
2
2
S
e
p
2
2
O
c
t
2
2
N
o
v
2
2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
% %
Liquidity Coverage Ratio (RHS)
Loan-to-Fund Ratio
Asset quality in the banking system remained intact
Banking System Asset Quality
Source: Bank Negara Malaysia
• Overall gross and net impaired loans ratios
increased slightly to 1.8% (February-23: 1.8%) and
1.2% (February-23: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory
reserves) continue to record a prudent level of
110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
%
1.8
1.2
1.7
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
M
a
r
2
2
A
p
r
2
2
M
a
y
2
2
J
u
n
2
2
J
u
l
2
2
A
u
g
2
2
S
e
p
2
2
O
c
t
2
2
N
o
v
2
2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
Gross Impaired Loans Ratio
Total Provisions to Total Loans Ratio
Net Impaired Loans Ratio
• Banks continued to record healthy liquidity buffers
with the aggregate Liquidity Coverage Ratio at
157.4% (February-23: 152.7%).
• The aggregate loan-to-fund ratio remained stable at
81.9% (February-23: 81.6%).
PRESS RELEASE
Ref. No.: 04/23/05 EMBARGO: Not for publication or
broadcast before 1500 hours on
Friday, 28 April 2023
Monthly Highlights – March 2023
Headline inflation declined to 3.4% in March
• Headline inflation declined to 3.4% in March (February: 3.7%) due mainly
to lower inflation for fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation1 moderated slightly to 3.8% during the month
(February: 3.9%), driven largely by lower inflation for food away from
home.
Robust growth in volume index driven by retail and motor vehicles
• The Index of Wholesale and Retail Trade (IOWRT) expanded by 10.6%
in February 2023 (January: 8.5%).
• The higher growth was driven mainly by retail sales in non-specialised
stores (e.g., department stores) followed by continued strength in
purchases of motor vehicles amid the ongoing fulfilment of backlog
orders.
• On a month-on-month seasonally adjusted basis, the index accelerated
by 5.5% (January: 0.2%).
1 Core inflation is computed by excluding price-volatile and price-administered items.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Growth in credit to the private non-financial sector2,3 moderated
• Credit to the private non-financial sector grew by 4.2% as at end-March
(February: 4.5%), attributed to slower growth in credit to businesses
(3.2%; February: 3.7%).
• While growth in outstanding corporate bonds moderated (4.4%;
February: 5.5%), outstanding business loan growth was sustained at
2.4% (February: 2.4%). This was supported by the continued growth in
both working capital (2.2%; February: 1.9%) and investment-related
loans (4.3%; February: 4.2%).
• Outstanding household loan growth remained broadly stable (5.2%;
February: 5.3%), supported by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan growth for the purchase of
securities (-6.9%; February: -3.3%).
Domestic financial market conditions remained orderly
• In March, global financial markets were affected by the emergence of
banking sector stress in some major economies. As spillovers were
contained thus far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds improved.
• In line with the performance of regional currencies, the ringgit
appreciated by 1.7% against the US dollar. Conditions in the domestic
bond market also remained stable.
• The FBM KLCI declined by 2.2% during the month.
Banks maintained strong liquidity and funding positions to support
intermediation
• Banks continued to record healthy liquidity buffers with the aggregate
Liquidity Coverage Ratio at 157.4% (February: 152.7%).
2 Comprises loans to households and non-financial corporations from the banking system and development financial
institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers).
3 Starting with the publication of December 2022 Monthly Highlights and Statistics (MHS), this series was introduced
to enhance the quality of financing data. This new data series is available in the MHS Table 2.18.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
• The aggregate loan-to-fund ratio remained stable at 81.9%
(February: 81.6%).
Asset quality in the banking system remained intact
• Overall gross and net impaired loans ratios increased slightly to 1.8%
(February: 1.8%) and 1.2% (February: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory reserves) continues to
record a prudent level of 110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
Bank Negara Malaysia
28 April 2023
20230428_BNM Monthly Highlights-March_en
Slide 1
Slide 2
20230428_BNM PR_Monthly Highlights-Mar 2023_eng
| Press Release |
31 Mar 2023 | Monetary and Financial Developments in February 2023 | https://www.bnm.gov.my/-/monetary-and-financial-developments-in-february-2023 | https://www.bnm.gov.my/documents/20124/10198405/i_en.pdf | null |
Reading:
Monetary and Financial Developments in February 2023
Share:
Monetary and Financial Developments in February 2023
Embargo :
For immediate release
Not for publication or broadcast before
1500 on
Friday, 31 March 2023
31 Mar 2023
Headline inflation was stable at 3.7% in February
Headline inflation was stable at 3.7% in February (January: 3.7%) as the increase in inflation for food and non-alcoholic beverages and rental was offset by the decline in inflation for recreation services and culture, as well as transport.
Of note, adverse weather conditions in January and February have also contributed to an increase in inflation for certain segments of fresh food, particularly fresh vegetables.
Meanwhile, underlying inflation, as measured by core inflation[1], was steady at 3.9% (January: 3.9%).
Higher export growth in February
Exports grew by 9.8% (January: 1.4%) in February 2023.
Manufactured export growth was driven mainly by electrical and electronics (E&E) and petroleum products. Meanwhile, commodities exports continued to be supported mainly by liquefied natural gas (LNG) and crude petroleum shipments.
Moving forward, the moderation in global growth and lower commodity prices are expected to weigh on Malaysia’s exports.
Credit growth remained supportive of economic activity
Credit to the private non-financial sector[2],[3] grew by 4.5% as at end-February (January: 4.3%), reflecting mainly the higher growth in credit to businesses (3.6%; January: 3.3%).
Outstanding household loan growth was sustained (5.3%; January: 5.3%), supported by higher growth in consumption-related credit (4.8%; January: 4.4%), while growth in outstanding loans for the purchase of securities declined (-3.3%; January: -1.4%). Of note, loan disbursement growth was strong across all purposes (25.4%; January: 9.4%).
For businesses, outstanding loan growth expanded by 2.3% (January: 2.1%), driven by higher growth in both working capital (1.9%; January: 1.6%) and investment-related financing (4.1%; January: 3.9%). Meanwhile, outstanding corporate bonds growth continued to increase (5.5%; January: 5.1%).
Domestic financial conditions tightened following an upward revision to the US policy rate expectations
Global financial conditions tightened as market participants revised upwards their expectations for the future US federal funds rate following stronger-than-expected US economic data.
Consequently, domestic financial conditions tightened. The 10-year Malaysian Government Securities (MGS) yields rose by 11 bps, in tandem with the movement of bond yields in regional* (average: 26 bps) and major economies. The FBM KLCI also declined by 2.1% (regional* average: -2.0%) amid non-resident portfolio outflows from the domestic equity market.
The ringgit depreciated by 4.9% against the US dollar, in line with the movement of regional* currencies (average: -3.9%).
Banks remain well-capitalised to support economic recovery
Banks continue to record strong capital buffers to absorb any unexpected shocks while preserving their ability to provide financing to the economy.
The banking system excess capital buffer[4] stood at RM135.0 billion.
Banks maintained strong liquidity and funding positions to support intermediation
The banking system reported healthy liquidity buffers with the aggregate Liquidity Coverage Ratio at 152.7% (January: 147.1%).
The aggregate loan-to-fund ratio remained largely stable at 81.5% (January: 82.3%), supported by sound growth in deposits of 7.0% (January: 7.5%).
See also: Monthly Highlights [PDF]
[1] Core inflation is computed by excluding price-volatile and price-administered items. It also excludes the estimated direct impact of tax policy changes.
[2] Comprises loans to households and non-financial corporations from the banking system and development financial institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers).
[3] Starting with the publication of December 2022 Monthly Highlights and Statistics (MHS), this series was introduced to enhance the quality of financing data. This new data series is available in the MHS Table 2.18.
*Regional countries comprise Singapore, Thailand, Philippines, Indonesia and Korea.
[4] Refers to total capital above the regulatory minimum, which includes the capital conservation buffer (2.5%) and bank-specific higher minimum requirements. Related Assets
Monthly Highlights & Statistics in February 2023
Bank Negara Malaysia
31 March 2023
© Bank Negara Malaysia, 2023. All rights reserved.
|
Monthly Highlights May 2023
Monthly Highlights
Headline inflation declined further to 2.8% in May
May 2023
Contribution to Inflation
ppt. contribution %, yoy
1 Core inflation is computed by excluding price-volatile and price-administered items.
Source: Department of Statistics, Malaysia & Bank Negara Malaysia estimates
• Headline inflation moderated to 2.8% (April 2023:
3.3%). This decline was largely due to non-core
CPI components, particularly lower inflation for
fuel (-0.2 percentage points, ppt) and fresh food
(-0.1ppt).
• Core inflation also declined slightly to 3.5% (April
2023: 3.6%) amid lower inflation for
communication services.
3.3
2.8
3.6 3.5
0.00
2.00
4.00
0.0
2.0
4.0
J
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Food & non-alcohol (29.5%) Housing & utilities (23.8%)
Transport (14.6%) Others (32.1%)
Headline inflation (RHS) Core inflation¹ (RHS)
1.6
5.1
4.6
0
1
2
3
4
5
6
7
May-22 Sep-22 Jan-23 May-23
Business loans
Household loans
Corporate bonds
Annual growth (%)
Credit to the Private Non-Financial Sector1,2
1
Growth in credit to the private non-financial sector improved in May
1 Comprises loans to households and non-financial corporations from the
banking system and development financial institutions (DFIs), and corporate
bonds issued by non-financial corporations (including short-term papers).
2 Starting with the publication of December 2022 Monthly Highlights and
Statistics (MHS), this series was introduced to enhance the quality of
financing data. This new data series is available in the MHS Table 2.18.
Source: Bank Negara Malaysia
Contribution to growth (ppt)
• Credit to the private non-financial sector expanded
by 4.0% as at end-May (April 2023: 3.7%), driven
mainly by higher growth in credit to businesses
(2.8%; April 2023: 2.5%).
• Outstanding corporate bonds grew by 4.6% (April
2023: 4.4%), while outstanding business loans
expanded by 1.6% (April 2023: 1.0%). The higher
business loan growth reflected improvement in
loans for both working capital and investments to
SMEs and non-SMEs.
• In the household segment, outstanding loan
growth was sustained at 5.1% (April 2023: 5.0%),
supported by higher growth across most loan
purposes. Of note, household loan growth
continued to be driven by loans for the purchase of
houses and cars, which grew by 7.0% and 8.4%,
respectively (April 2023: 6.8% and 8.0%).
2.7 2.6 2.5 2.6
0.7 0.7 0.3 0.5
1.1 0.9
0.9 1.0
4.5 4.2
3.7 4.0
Feb-23 Mar-23 Apr-23 May-23
Corporate Bonds
Business Loans
Household Loans
Credit to the Private Non-
Financial Sector
Index of wholesale and retail trade growth moderated in April
Source: Department of Statistics, Malaysia
• The Index of Wholesale and Retail Trade
(IOWRT) expanded more moderately by 4.7% in
April 2023 (March 2023: 9.4%). The lower growth
was due mainly to the decline in the motor vehicle
segment.
• However, the retail segment continued to record a
double-digit growth of 10.0% (March 2023:
13.8%), supported by sales in non-specialised and
other specialised stores1.
• On a month-on-month seasonally adjusted basis,
the index increased at a faster pace of 6.5%
(March 2023: -0.9%).
1 Other goods in specialised stores includes clothing, footwear,
pharmaceuticals, cosmetics, watches, jewellery and optical goods.
10.6
9.4
4.7
-2
3
8
13
18
23
28
33
Apr-22 Jun-22 Aug-22 Oct-22 Dec-22 Feb-23 Apr-23
ppt, %yoy
Motor vehicles Retail Wholesale
Index of Wholesale and Retail Trade
Monthly Highlights
2
May 2023
Domestic financial markets were largely affected by external factors
Financial Market Performance in May 2023
-18.0
-0.5
-1.1
-3.0
-2.0
-3.4
10-year MGS
(bps, mom)
Equity
(%, mom)
Ringgit
(%, mom)
-20 -15 -10 -5 0
May-23 Apr-23
Note: The exchange rate data is the noon-rate in the Kuala Lumpur Interbank Foreign Exchange Market
1Regional countries comprise Singapore, Thailand, Philippines, Indonesia, and Korea
Source: Bank Negara Malaysia, Bursa Malaysia
• Global investors maintained a risk-off approach
throughout May, as concerns over the impact of the
US debt ceiling crisis and the weaker-than-
expected rebound in China’s economy weighed on
global financial markets.
• As a result, the ringgit depreciated against the US
dollar by 3.4% (regional1 average: -1.2%). Similarly,
the FBM KLCI declined by 2.0% (regional1 average:
-1.3%).
• Nonetheless, the 10-year MGS yields decreased
slightly by 3 basis points, supported by non-resident
inflows into the domestic bond market.
Banks maintained strong liquidity and funding positions to support intermediation
• Banks continued to record healthy liquidity buffers
with the aggregate Liquidity Coverage Ratio at
151.2% (April 2023: 154.3%).
• The aggregate loan-to-fund ratio remained stable at
81.8% (April 2023: 82.1%).
Source: Bank Negara Malaysia
Banking System Liquidity and Funding Ratios
81.8
151.2
0
40
80
120
160
70
75
80
85
90
95
M
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J
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M
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2
3
A
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2
3
M
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2
3
% %
Liquidity Coverage Ratio (RHS)
Loan-to-Fund Ratio
Asset quality in the banking system remained intact
Banking System Asset Quality
Source: Bank Negara Malaysia
• Overall gross and net impaired loans ratios
remained broadly unchanged at 1.80% (April
2023: 1.78%) and 1.10% (April 2023: 1.10%),
respectively.
• Loan loss coverage ratio (including regulatory
reserves) remained at a prudent level of 114.1%
of impaired loans, with total provisions accounting
for 1.7% of total loans.
%
1.8
1.1
1.7
0.5
1.0
1.5
2.0
M
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A
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M
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2
3
Gross Impaired Loans Ratio
Total Provisions to Total Loans Ratio
Net Impaired Loans Ratio
April 2023 Monthly Highlights
Slide 1
Slide 2
| Press Release |
31 Mar 2023 | Detailed Disclosure of International Reserves as at end-February 2023 | https://www.bnm.gov.my/-/detailed-disclosure-of-international-reserves-as-at-end-february-2023-1 | null | null |
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Detailed Disclosure of International Reserves as at end-February 2023
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Detailed Disclosure of International Reserves as at end-February 2023
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31 Mar 2023
In accordance with the International Monetary Fund (IMF) Special Data Dissemination Standard (SDDS) format, the detailed breakdown of international reserves provides forward-looking information on the size, composition and usability of reserves and other foreign currency assets, and the expected and potential future inflows and outflows of foreign exchange of the Federal Government and Bank Negara Malaysia over the next 12-month period.
The detailed breakdown of international reserves based on the SDDS format is shown in Tables I, II, III and IV.
As shown in Table I, official reserve assets amounted to USD114,321.1 million, while other foreign currency assets amounted to USD1.3 million as at end-February 2023.
As shown in Table II, for the next 12 months, the pre-determined short-term outflows of foreign currency loans, securities and deposits, which include among others, scheduled repayment of external borrowings by the Government and the maturity of foreign currency Bank Negara Interbank Bills, amounted to USD17,355.8 million. The short forward positions amounted to USD26,274.5 million as at end-February 2023, reflecting the management of ringgit liquidity in the money market. In line with the practice adopted since April 2006, the data excludes projected foreign currency inflows arising from interest income and the drawdown of project loans. Projected foreign currency inflows amount to USD2,183.5 million in the next 12 months.
As shown in Table III, the only contingent short-term net drain on foreign currency assets are Government guarantees of foreign currency debt due within one year, amounting to USD371.1 million. There are no foreign currency loans with embedded options, no undrawn, unconditional credit lines provided by or to other central banks, international organisations, banks and other financial institutions. Bank Negara Malaysia also does not engage in foreign currency options vis-à-vis ringgit.
Overall, the detailed breakdown of international reserves under the IMF SDDS format indicates that as at end-February 2023, Malaysia’s international reserves remain usable. Related Assets
International Reserves and Foreign Currency Liquidity (28 February 2023)
Bank Negara Malaysia
31 March 2023
© Bank Negara Malaysia, 2023. All rights reserved.
| null | Press Release |
31 Mar 2023 | Launch of Cross-border QR Code Payments Connectivity between Malaysia and Singapore | https://www.bnm.gov.my/-/qrcode-connectivity-my-sg | null | null |
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Launch of Cross-border QR Code Payments Connectivity between Malaysia and Singapore
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Launch of Cross-border QR Code Payments Connectivity between Malaysia and Singapore
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Friday, 31 March 2023
31 Mar 2023
DuitNow-NETS QR is now connected: Travellers can scan merchant QR codes to make payments between Malaysia and Singapore
Person-to-person (P2P) fund transfers will be ready by year-end
Bank Negara Malaysia (BNM) and the Monetary Authority of Singapore (MAS) today launched a cross-border QR code payment linkage between Malaysia and Singapore. This payment linkage will allow customers of participating financial institutions[1] to make retail payments by scanning DuitNow QR and NETS QR codes[2]. It will support in-person payments through the scanning of physical QR codes displayed by merchants, and online cross-border e-commerce transactions.
The DuitNow-NETS QR code payment linkage is a key milestone in the on-going collaboration between Malaysia and Singapore to enhance cross-border payments connectivity. With pre-pandemic annual traffic between the two countries averaging 12 million visitors, the payment linkage will provide merchants and consumers with a more seamless and efficient means to make and receive payments. This initiative is testament to both countries’ commitment to improve the cost, speed, access and transparency of cross border payments, in line with the ASEAN Payment Connectivity Initiative and the G20 Roadmap for Enhancing Cross-border Payments.
This cross-border QR code payment linkage is made possible through the strong collaboration of various industry players from both countries, including Payments Network Malaysia Sdn. Bhd. (PayNet), Network for Electronic Transfers (Singapore) Pte. Ltd (NETS), the Association of Banks in Singapore, and participating financial institutions from both countries.
In the next phase, BNM and MAS plan to expand the payment linkage to enable cross-border account-to-account fund transfers and remittances. This will allow users to make real-time fund transfers between Malaysia and Singapore conveniently using just the recipient’s mobile phone number via DuitNow and PayNow. This service is expected to go live by end-2023.
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Mohd Yunus said, “This is a significant step forward in realising the vision of an ASEAN network of fast, efficient and interconnected retail payment systems. The QR linkage between Malaysia and Singapore will benefit millions of commuters across the Causeway as well as business and leisure travellers. It will also be a boost to retail businesses in both countries. We will continue to work closely with our partners to accelerate our digitalisation agenda towards increased regional economic and financial integration.”
Managing Director of the Monetary Authority of Singapore, Mr Ravi Menon, said, “The DuitNow-NETS QR code payment linkage is the latest addition to Singapore’s growing set of cross-border payment linkages. These linkages will help boost cross-border commerce and enable our merchants, especially small businesses to tap on a wider pool of consumers. This QR code linkage between Singapore and Malaysia is an important milestone in ASEAN’s journey towards seamless regional payments connectivity.”Bank Negara Malaysia
Monetary Authority of Singapore
31 March 2023
[1] Participants from Malaysia are AmBank Malaysia Berhad, Boost, CIMB Bank Berhad, Hong Leong Bank Berhad, Malayan Banking Berhad, Public Bank Berhad, Razer Merchant Services Sdn. Bhd., TNG Digital Sdn. Bhd. and United Overseas Bank Malaysia Berhad. Participants from Singapore are DBS Bank, OCBC Bank and UOB. (As at 31 March 2023).
[2] DuitNow QR is the national QR code solution in Malaysia operated by Payments Network Malaysia Sdn. Bhd. (PayNet). NETS QR is the QR code solution operated by Singapore’s electronic payment network, NETS. DuitNow QR and NETS QR allow merchants to accept payments from customers of different participating banks and e-wallet operators using a unified QR code.
Bank Negara Malaysia
31 March 2023
© Bank Negara Malaysia, 2023. All rights reserved.
| null | Press Release |
29 Mar 2023 | Bank Negara Malaysia Publishes Annual Report 2022, Economic and Monetary Review 2022 and Financial Stability Review for Second Half 2022 | https://www.bnm.gov.my/-/ar2022_en_pr | https://www.bnm.gov.my/documents/20124/10118437/ar2022_transcript.pdf, https://www.bnm.gov.my/documents/20124/10118437/ar2022_slides2.pdf | null |
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Bank Negara Malaysia Publishes Annual Report 2022, Economic and Monetary Review 2022 and Financial Stability Review for Second Half 2022
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Bank Negara Malaysia Publishes Annual Report 2022, Economic and Monetary Review 2022 and Financial Stability Review for Second Half 2022
Embargo :
For immediate release
Not for publication or broadcast before
1100 on
Wednesday, 29 March 2023
29 Mar 2023
Bank Negara Malaysia (BNM) today released its Annual Report 2022 (AR 2022), Economic and Monetary Review 2022 (EMR 2022) and Financial Stability Review for Second Half 2022 (FSR 2H2022).
Annual Report 2022
AR 2022 details the key initiatives of the Bank in 2022 in fulfilling its mandates to promote monetary and financial stability conducive to the sustainable growth of the Malaysian economy. The report also provides an account of the Bank’s operations and resources that enable it to function effectively and efficiently.
Highlights of AR 2022:
Building a robust ecosystem that fosters innovation, competition, and dynamism in the financial sector remains a priority for BNM. A key strategy in this regard has been to facilitate the entry of new digital-first players.
BNM continued to work closely with industry partners to reduce barriers to e-payment adoption and promote the responsible and safe use of e-payments, including through e-Duit campaign. BNM also intensified efforts to establish cross-border payment linkages with Indonesia, Philippines, Singapore and Thailand to enable more convenient, safe and cheaper cross-border payment services.
BNM pioneered the world’s first transaction-based Islamic benchmark rate developed in accordance with the international Principles for Financial Benchmarks. The introduction of the Malaysia Islamic Overnight Rate (MYOR-i) will encourage greater Islamic financial product innovation and increase price transparency for Islamic financial contracts. In addition, partnering with the Securities Commission Malaysia, BNM established the MIFC Leadership Council to further advance Malaysia’s Islamic finance agenda and provide greater industry stewardship.
BNM will continue to collaborate with the Government and financial industry to heighten efforts to combat online financial scams, increase the public’s awareness on scam prevention, and ensure that emerging cyber threats are effectively managed. BNM also strengthened cross-border cooperation to better detect, trace and recover funds for victims through the Financial Intelligence Consultative Group of 12 member countries.
The Bank has made significant progress throughout the year to address climate-related risks. The focus has been on strengthening the financial sector's climate resilience, scaling up financing and protection support for businesses to reduce their carbon footprint, and advancing research to better understand how climate and nature interacts with the financial system and economy.
Eleven articles are featured in AR 2022, covering topics of general interest:
The Exchange Rate and the Malaysian Economy;
Inflation: Its evolution, two years after the pandemic;
Driving into the Future - A Digital Motor Claims Journey;
Fostering International Connectivity among Central Shariah Boards in Islamic Finance;
MIFC Leadership Council: Galvanising Greater Industry Stewardship;
Empowering Communities with Digital Financial Services;
Cross Border Payment Linkages - Project Nexus and the Push for a Multilateral Approach;
Banknote Counterfeiting in Malaysia: Trends, Challenges and Strategies;
Measuring the Journey towards a Low Carbon Economy;
Biodiversity Loss: Implications on the Economy and Financial Stability; and
Let’s Go Digital Confidently
AR 2022 also sets out BNM’s Audited Financial Statements for the financial year ended 31 December 2022. As audited and certified by the Auditor General, the financial position of BNM remained stable in 2022. BNM’s total assets amounted to RM619.0 billion as at 31 December 2022. A net profit after tax of RM7.0 billion was recorded for the financial year, of which RM4.2 billion has been transferred into BNM’s Risk Reserve. BNM has declared a dividend of RM2.8 billion to the Government for the financial year 2022.
Economic and Monetary Review 2022
The Economic and Monetary Review outlines BNM’s economic assessments and forecasts.
Highlights of EMR 2022:
In 2023, the global economic environment is expected to remain challenging and uncertain. Slower growth and tighter monetary policies in major economies, and subdued global trade activity are expected.
Despite global headwinds, the Malaysian economy is projected to grow between 4.0% and 5.0% in 2023, supported by firm domestic demand. Further improvement in labour market conditions, continued implementation of multi-year investment projects and higher tourism activity are expected to support private consumption and investment growth.
Both headline and core inflation are projected to average between 2.8% and 3.8% in 2023. Inflation is expected to moderate, driven by the lower prices of key commodities. However, the outlook for inflation in 2023 remains tilted to the upside. Upside risks include worsening geopolitical conflict leading to higher commodity prices, extreme weather conditions, stronger-than-expected demand from China and higher input costs due to exchange rate developments.
The resilient domestic banking system and the presence of domestic institutional investors continue to support financial intermediation activities to support economic growth.
Monetary policy will remain supportive of sustainable economic growth while ensuring an environment of price stability.
The EMR 2022 also features three box articles covering structural issues crucial to the long-term development of the economy and its people:
Rebuilding Retirement Savings and Financial Safety Nets in Malaysia;
Analytical Approaches to Assessing Labour Market Conditions and Implications to Monetary Policy; and
Navigating Malaysia's Economic Transition towards a Decarbonised Future
Financial Stability Review for Second Half 2022
The Financial Stability Review is a biannual publication which details BNM’s assessment of domestic financial stability risks and outlook.
Highlights of FSR 2H 2022:
Market conditions have remained orderly despite the heightened volatility in domestic financial markets. The reopening of most economic sectors and improvements in labour market conditions have supported the debt-servicing capacity of businesses and households, with the share of loans under repayment assistance continuing to decline.
Sound risk management practices of financial institutions, coupled with their strong capital and liquidity buffers, will continue to preserve domestic financial stability. Latest stress tests conducted by BNM affirm the resilience of financial institutions against unexpected losses from severe macroeconomic and financial shocks. This secures financial institutions’ capacity to continue supporting the financing and protection needs of households and businesses as economic activities resume.
Operational and cyber resilience remains a top priority for BNM and financial institutions amid the increase in digitalisation and technology adoption in finance. BNM will also continue working with financial institutions to strengthen climate risk management practices and support greater access to transition finance.
Four articles are featured in FSR 2H 2022:
Artificial Intelligence in the Malaysian Financial System: Opportunities, Risks, and the Way Forward;
Managing Transmission of Vulnerabilities in Commodity Markets Associated with the Application of Tawarruq in the Islamic Banking System;
Recent Market and Regulatory Developments in the Digital Asset Space; and
Implementation Progress of the Climate Change and Principle-based Taxonomy (CCPT) in the Financial Sector
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “Despite the headwinds, the Malaysian economy is expected to continue to expand this year, and not enter a recession. Our financial system will continue to be a key source of strength for our economy in supporting the financing needs for Malaysia’s transformation into a high-income, high value-added and low carbon economy. Structural reforms remain important, but a carefully considered sequencing of these critical reforms will be important to deliver sustainable growth and price stability, while minimising transitory costs.”
For more details of the publications, please visit bnm.gov.my/AR2022
See also:
EMR 2022 Key Highlights
FSR 2H 2022 Key Highlights
Press Conference Slides
Press Conference Transcript
Press Conference VideoBank Negara Malaysia
29 March 2023
© Bank Negara Malaysia, 2023. All rights reserved.
|
Sorotan Bulanan
Inflasi keseluruhan berkurang kepada 3.4% pada bulan Mac
Mac 2023
3.7 3.4
3.9 3.8
0.00
2.00
4.00
0.0
2.0
4.0
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Makanan & minuman bukan alkohol (29.5%) Perumahan & utiliti (23.8%)
Pengangkutan (14.6%) Lain-lain (32.1%)
Inflasi keseluruhan (skala kanan) Inflasi teras¹ (skala kanan)
Sumbangan kepada inflasi
Sumbangan mata peratusan %, tahun ke tahun
1 Pengiraan inflasi teras tidak termasuk barangan yang harganya tidak menentu
dan barangan yang harganya ditadbir.
Sumber: Jabatan Perangkaan Malaysia dan anggaran Bank Negara Malaysia
• Inflasi keseluruhan berkurang kepada 3.4% pada bulan
Mac (Februari: 3.7%) disebabkan terutamanya oleh
inflasi yang lebih rendah bagi bahan api, tambang
penerbangan dan barangan makanan terpilih. Keadaan
ini sejajar dengan penurunan harga komoditi global.
• Inflasi teras menurun sedikit kepada 3.8% pada bulan
Mac (Februari: 3.9%), didorong sebahagian besarnya
oleh inflasi yang lebih rendah untuk makanan di luar
rumah.
1
Pertumbuhan mantap nilai indeks didorong oleh indeks runcit dan kenderaan motor
Indeks Perdagangan Borong dan Runcit
Sumber: Jabatan Perangkaan Malaysia
• Indeks Perdagangan Borong dan Runcit (Index of
Wholesale and Retail Trade, IOWRT) berkembang
sebanyak 10.6% pada bulan Februari 2023
(Januari: 8.5%).
• Pertumbuhan yang lebih tinggi ini disokong
terutamanya oleh jualan runcit di kedai bukan khusus
(contohnya, gedung serbaneka) disusuli dengan
pembelian kenderaan motor yang terus teguh
berikutan pesanan tertunggak yang terus dipenuhi.
• Pada asas bulan ke bulan terlaras secara bermusim,
IOWRT melonjak sebanyak 5.5% (Januari: 0.2%).
2.4
5.2
4.4
0
1
2
3
4
5
6
7
Mac-22 Jul-22 Nov-22 Mac-23
Pinjaman perniagaan
Pinjaman isi rumah
Bon korporat
Pertumbuhan tahunan (%)
Pertumbuhan kredit kepada sektor swasta bukan kewangan pada bulan Mac sederhana
1 Terdiri daripada pinjaman kepada isi rumah dan syarikat bukan kewangan oleh
sistem perbankan dan institusi kewangan pembangunan (IKP) serta bon korporat
yang diterbitkan oleh syarikat bukan kewangan (termasuk kertas jangka pendek).
2 Mulai penerbitan Sorotan dan Perangkaan Bulanan (Monthly Highlights and
Statistics, MHS) bulan Disember 2022, siri ini diperkenalkan untuk meningkatkan
kualiti data pembiayaan. Siri data baharu ini tersedia dalam Jadual 2.18 MHS.
Sumber: Bank Negara Malaysia
2.7 2.6 2.7 2.6
1.0 0.6 0.7 0.7
1.0
1.1 1.1 0.9
4.7
4.3 4.5 4.2
Dis-22 Jan-23 Feb-23 Mac-23
Bon Korporat
Pinjaman Perniagaan
Pinjaman Isi Rumah
Kredit kepada Sektor Swasta
Bukan Kewangan
Sumbangan kepada pertumbuhan
(mata peratusan)
• Kredit kepada sektor swasta bukan kewangan
meningkat sebanyak 4.2% pada akhir bulan Mac
(Februari: 4.5%) yang disebabkan oleh pertumbuhan
pemberian kredit kepada perniagaan yang lebih
perlahan (3.2%; Februari: 3.7%).
• Walaupun pertumbuhan bon korporat terkumpul
menjadi sederhana (4.4%; Februari: 5.5%),
pertumbuhan pinjaman perniagaan terkumpul kekal
pada 2.4% (Februari: 2.4%). Hal ini disokong oleh
pertumbuhan yang berterusan dalam pinjaman modal
kerja (2.2%; Februari: 1.9%) dan pinjaman berkaitan
pelaburan (4.3%; Februari: 4.2%).
• Pertumbuhan pinjaman isi rumah terkumpul secara
amnya kekal stabil (5.2%; Februari: 5.3%), disokong
oleh pertumbuhan pinjaman untuk pembelian kereta
(8.7%; Februari: 7.6%). Hal ini dalam keadaan
pertumbuhan pinjaman yang lebih rendah untuk
pembelian sekuriti (-6.9%; Februari: -3.3%).
Kredit kepada Sektor Swasta Bukan Kewangan1,2
9.5 8.510.6
0
10
20
30
40
Feb-
22
Mar-
22
Apr-
22
May-
22
Jun-
22
Jul-
22
Aug-
22
Sep-
22
Oct-
22
Nov-
22
Dec-
22
Jan-
23
Feb-
23
mata peratusan,
tahun ke tahun Kenderaan motor Runcit Borong
Feb- Mac- Apr- Mei- Jun- Jul- Ogo- Sep- Okt- Nov- Dis- Jan- Feb-
22 22 22 22 22 22 22 22 22 22 22 23 23
Sorotan Bulanan
Mac 2023
Keadaan pasaran kewangan domestik kekal teratur
Prestasi Pasaran Kewangan pada bulan Mac 2023
Sumber: Bank Negara Malaysia dan Bursa Malaysia
Nota: Data kadar pertukaran ialah kadar pukul 12.00 tengah hari dalam
Pasaran Pertukaran Mata Wang Asing Antara Bank Kuala Lumpur
11.0
-2.1
-5.3
0.0
-2.2
1.7
MGS 10 tahun (mata asas,
bulan ke bulan)
Ekuiti
(%, bulan ke bulan)
Ringgit
(%, bulan ke bulan)
-10 -5 0 5 10 15
Mac-23
Feb-23
• Pada bulan Mac, pasaran kewangan global terjejas oleh
kewujudan tekanan sektor perbankan di beberapa
ekonomi utama. Berikutan limpahan dapat dibendung
setakat ini disebabkan oleh tindakan awal pihak
berkuasa, kesanggupan pelabur mengambil risiko telah
meningkat berhubung dengan mata wang dan bon di
pasaran sedang pesat membangun.
• Selaras dengan prestasi mata wang serantau, ringgit
menambah nilai sebanyak 1.7% berbanding dengan
dolar AS. Keadaan pasaran bon domestik juga kekal
stabil.
• FBM KLCI menurun sebanyak 2.2% pada bulan Mac.
2
Bank-bank mengekalkan kedudukan mudah tunai dan pendanaan yang kukuh untuk menyokong
aktiviti pengantaraan
Sumber: Bank Negara Malaysia
Nisbah Mudah Tunai dan Pendanaan Sistem Perbankan
81.9
157.4
0
40
80
120
160
70
75
80
85
90
95
M
a
c
-2
2
A
p
r-
2
2
M
e
i-
2
2
J
u
n
-2
2
J
u
l-
2
2
O
g
o
-2
2
S
e
p
-2
2
O
k
t-
2
2
N
o
v
-2
2
D
is
-2
2
J
a
n
-2
3
F
e
b
-2
3
M
a
c
-2
3
% %
Nisbah Perlindungan Mudah Tunai (skala kanan)
Nisbah Pinjaman kepada Dana
Kualiti aset sistem perbankan kekal baik
Kualiti Aset Sistem Perbankan
Sumber: Bank Negara Malaysia
• Nisbah pinjaman terjejas kasar dan bersih keseluruhan
meningkat sedikit, masing-masing kepada 1.8% (Februari:
1.8%) dan 1.2% (Februari: 1.1%).
• Nisbah perlindungan kerugian pinjaman (termasuk rizab
pengawalseliaan) kekal pada tahap berhemat sebanyak
110.5% daripada pinjaman terjejas, dengan jumlah
peruntukan mencakupi 1.7% daripada jumlah pinjaman.
%
1.8
1.2
1.7
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
M
a
c
-2
2
A
p
r-
2
2
M
e
i-
2
2
J
u
n
-2
2
J
u
l-
2
2
O
g
o
-2
2
S
e
p
-2
2
O
k
t-
2
2
N
o
v
-2
2
D
is
-2
2
J
a
n
-2
3
F
e
b
-2
3
M
a
c
-2
3
Nisbah Pinjaman Terjejas Kasar
Nisbah Jumlah Peruntukan kepada Jumlah Pinjaman
Nisbah Pinjaman Terjejas Bersih
• Bank-bank terus mencatatkan kedudukan penampan
mudah tunai yang utuh dengan Nisbah Perlindungan
Mudah Tunai agregat pada 157.4% (Februari: 152.7%).
• Nisbah pinjaman kepada dana agregat kekal stabil pada
81.9% (Februari: 81.6%).
SIARAN AKHBAR
No. Ruj.: 04/23/05 EMBARGO: Tidak boleh dicetak
atau disiarkan sebelum pukul 1500
hari Jumaat, 28 April 2023
Sorotan Bulan – April 2023
Inflasi keseluruhan berkurang kepada 3.4% pada bulan Mac
• Inflasi keseluruhan berkurang kepada 3.4% pada bulan Mac (Februari:
3.7%) disebabkan terutamanya oleh inflasi yang lebih rendah bagi bahan
api, tambang penerbangan dan barangan makanan terpilih. Keadaan ini
sejajar dengan penurunan harga komoditi global.
• Inflasi teras1 menurun sedikit kepada 3.8% pada bulan Mac (Februari:
3.9%), didorong sebahagian besarnya oleh inflasi yang lebih rendah
untuk makanan di luar rumah.
Pertumbuhan mantap nilai indeks didorong oleh indeks runcit dan
kenderaan motor
• Indeks Perdagangan Borong dan Runcit (Index of Wholesale and Retail
Trade, IOWRT) berkembang sebanyak 10.6% pada bulan Februari 2023
(Januari: 8.5%).
• Pertumbuhan yang lebih tinggi ini disokong terutamanya oleh jualan
runcit di kedai bukan khusus (contohnya, gedung serbaneka) disusuli
dengan pembelian kenderaan motor yang terus teguh berikutan pesanan
tertunggak yang terus dipenuhi.
1 Pengiraan inflasi teras tidak termasuk barangan yang harganya tidak menentu dan barangan yang harganya ditadbir.
D i t e r b i t k a n o l e h :
J a b a t a n K o m u n i k a s i S t r a t e g i k , T i n g k a t 1 4 , B l o k B , B a n g u n a n B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m e l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
• Pada asas bulan ke bulan terlaras secara bermusim, IOWRT melonjak
sebanyak 5.5% (Januari: 0.2%).
Pertumbuhan kredit kepada sektor swasta bukan kewangan2,3 pada bulan
Mac sederhana
• Kredit kepada sektor swasta bukan kewangan meningkat sebanyak 4.2%
pada akhir bulan Mac (Februari: 4.5%) yang disebabkan oleh
pertumbuhan pemberian kredit kepada perniagaan yang lebih perlahan
(3.2%; Februari: 3.7%).
• Walaupun pertumbuhan bon korporat terkumpul menjadi sederhana
(4.4%; Februari: 5.5%), pertumbuhan pinjaman perniagaan terkumpul
kekal pada 2.4% (Februari: 2.4%). Hal ini disokong oleh pertumbuhan
yang berterusan dalam pinjaman modal kerja (2.2%; Februari: 1.9%) dan
pinjaman berkaitan pelaburan (4.3%; Februari: 4.2%).
• Pertumbuhan pinjaman isi rumah terkumpul secara amnya kekal stabil
(5.2%; Februari: 5.3%), disokong oleh pertumbuhan pinjaman untuk
pembelian kereta (8.7%; Februari: 7.6%). Hal ini dalam keadaan
pertumbuhan pinjaman yang lebih rendah untuk pembelian sekuriti (-
6.9%; Februari: -3.3%).
Keadaan pasaran kewangan domestik kekal teratur
• Pada bulan Mac, pasaran kewangan global terjejas oleh kewujudan
tekanan sektor perbankan di beberapa ekonomi utama. Berikutan
limpahan dapat dibendung setakat ini disebabkan oleh tindakan awal
pihak berkuasa, kesanggupan pelabur mengambil risiko telah meningkat
berhubung dengan mata wang dan bon di pasaran sedang pesat
membangun.
2 Terdiri daripada pinjaman kepada isi rumah dan syarikat bukan kewangan oleh sistem perbankan dan institusi
kewangan pembangunan (IKP) serta bon korporat yang diterbitkan oleh syarikat bukan kewangan (termasuk kertas
jangka pendek).
3 Mulai penerbitan Sorotan dan Perangkaan Bulanan (Monthly Highlights and Statistics, MHS) bulan Disember 2022,
siri ini diperkenalkan untuk meningkatkan kualiti data pembiayaan. Siri data baharu ini tersedia dalam Jadual 2.18
MHS.
D i t e r b i t k a n o l e h :
J a b a t a n K o m u n i k a s i S t r a t e g i k , T i n g k a t 1 4 , B l o k B , B a n g u n a n B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m e l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
• Selaras dengan prestasi mata wang serantau, ringgit menambah nilai
sebanyak 1.7% berbanding dengan dolar AS. Keadaan pasaran bon
domestik juga kekal stabil.
• FBM KLCI menurun sebanyak 2.2% pada bulan Mac.
Bank-bank mengekalkan kedudukan mudah tunai dan pendanaan yang
kukuh untuk menyokong aktiviti pengantaraan
• Bank-bank terus mencatatkan kedudukan penampan mudah tunai yang
utuh dengan Nisbah Perlindungan Mudah Tunai agregat pada 157.4%
(Februari: 152.7%).
• Nisbah pinjaman kepada dana agregat kekal stabil pada 81.9%
(Februari: 81.6%).
Kualiti aset sistem perbankan kekal baik
• Nisbah pinjaman terjejas kasar dan bersih keseluruhan meningkat
sedikit, masing-masing kepada 1.8% (Februari: 1.8%) dan 1.2%
(Februari: 1.1%).
• Nisbah perlindungan kerugian pinjaman (termasuk rizab
pengawalseliaan) kekal pada tahap berhemat sebanyak 110.5%
daripada pinjaman terjejas, dengan jumlah peruntukan mencakupi 1.7%
daripada jumlah pinjaman.
Bank Negara Malaysia
28 April 2023
20230428_BNM Monthly Highlights-March_bm
Slide 1
Slide 2
20230428_BNM PR_Monthly Highlights-Mar 2023_bm
AR2022 Press Conference Slides
Option 1
BANK NEGARA MALAYSIA
■ ANNUAL REPORT 2022
■ ECONOMIC AND MONETARY REVIEW 2022
■ FINANCIAL STABILITY REVIEW – SECOND HALF 2022
29 MARCH 2023
1
Overview:
Malaysian economy to expand in 2023, albeit at a more moderate pace
In 2022, GDP expanded strongly by 8.7%
despite slower global growth, and was driven by recovery in private
and public sector spending following the full reopening of the economy
Growth is expected to moderate in 2023
amid slower global growth, but remain driven by firm domestic demand
Risks to growth outlook fairly balanced
with downside risks emanating primarily from external developments,
while there are upside risks mainly from domestic factors
2
Global economy facing a challenging and uncertain landscape
Source: Bank Negara Malaysia estimates, International Monetary Fund
6.2
3.4
2.4 - 2.9
2021 2022e 2023f
Global Real GDP Growth
Annual Change (%)
3
Global growth will be supported by…
▲ Resilient labour markets underpinning household spending
▲ Full reopening of China’s economy
▲ Easing of supply chain disruptions
… but is facing headwinds from:
▼ Elevated inflation
▼ Tight monetary policy and financial conditions
Higher financial market volatility and uncertainty amid the recent
banking stress in advanced economies
Source: Department of Statistics, Malaysia and Bank Negara Malaysia estimates
12.8
2.7
2022p 2023f
Real Exports of Goods & Services
Annual Change (%)
Avg. 2011-19 : 2.1% Travel Receipts
RM billion
2019:
82.1
2020:
12.5
2021:
0.3
2022:
27.9
2023f:
58.0
Tourism Industry Share of Growth & Employment
% share, 2019
Gross Value Added
of Tourism
Industries (GVATI)
15.9% of GDP
Employment in
tourism industry
23.6% of
total employment
Malaysia’s export growth to moderate in tandem with global outlook
Some recovery in inbound travel to support export growth
4
Current
account
surplus
(% of GDP)
2.6% 2.5% - 3.5%
2023f
5.44
2022
5.26
2023f
5.43
2022
5.35
Household spending underpinned by continued income growth
11.3
6.1
2022 2023f
1 Based on MEF Salary Survey for Executives and Non-Executives 2022 which covered 157 benchmarked positions of 17,857 executives and 105 benchmarked positions of 34,970 non-executives.
2 Effective 1st July 2023 for firms employing fewer than five employees.
3 Under the newly amended Employment Act, employees entitled to overtime pay will include those earning up to RM4,000 a month (previously up to RM2,000 a month).
f Forecast
Source: Department of Statistics Malaysia (DOSM), Malaysian Employers Federation (MEF), Ministry of Human Resources (MOHR), Ministry of Finance (MOF), and Bank Negara Malaysia estimates.
Real private consumption
Annual change (%)
…with support from
Government policy measures
Income growth continues to
drive household expenditure…
Executives
Non-Executives
MEF: Salary Increase for Executives & Non-
Executives1
Annual change (%) Higher minimum wage for
employees in small firms2
Expansion of overtime pay
eligibility3
Direct cash assistance
Individual income tax revision
5
Avg. 2011-19: 7.1%
Sustained improvement in labour market conditions
Source: SOCSO, Department of Statistics, Malaysia, Ministry of Finance (MOF), and Bank Negara Malaysia estimates
…coupled with policy measures
to support labour markets
Hiring Incentives
Upskilling & Reskilling Initiatives
Youth & Graduate Employment Scheme
Continued expansion in
consumer- and tourism-related
sectors…
Total Employment
Persons
2021 2022p 2023f
15.3 mil
15.8 mil
~16.1 mil
4.6%
3.9%
~3.5%
2021 2022p 2023f
Unemployment
% of Labour Force
Higher
employment
Lower
unemployment
6
2019:
3.3%
2019:
15.1mil
EMR 2022 Article “Analytical Approaches to Assessing Labour Market Conditions and Implications to Monetary Policy”
Enhanced surveillance tools suggest limited risk of excessive
wage pressures
COVID-19 necessitated enhanced analytical
approaches to assess labour market conditions…
…which suggest inflationary wage pressures
would remain contained in 2023
Alternative Slack Rates
Measurements of slack include underemployed and
workers who left due to COVID-19
Industrial Insights
Field interviews with business community to
supplement analytical assessments
Statistical Thresholds
Various indicators assessed against ‘normal’ range
within historical series to assess tightness
● Forthcoming labour supply
Return of discouraged workers1
Re-entries of foreign workers
● Higher production efficiency
● No excessive wage adjustments
Downward
pressure
● Strength in employment recovery
● Implementation of minimum wage hike
● Increase in overtime paymentsUpward
pressure
7
1 Discouraged workers refer to workers who previously left the labour force, potentially due to lack of
economic opportunities or increase in caregiving obligations during the COVID-19 pandemic.
https://www.bnm.gov.my/emr22b2
8
Investments supported by continued capacity expansion
and multi-year projects
f forecast
Source: Department of Statistics, Malaysia, Bank Negara Malaysia estimates
*Refers to completion progress of construction activities between 0%-30% and 30%-70%, respectively
Source: Department of Statistics, Malaysia, MIDA, newsflows
…supported by improvement in construction activityContinued expansion in
investment…
…and continuation of large-scale infrastructure projects
ECRL
RM50.0 billion
Duration: 2018-2026
LRT3
RM16.6 billion
Duration: 2018-2024
MyDIGITAL 5G
RM16.5 billion
Duration: 2021-2031
Pan Borneo Highway
(Sabah)
RM16.0 billion
Duration: 2016-2024
Central Spine Road
RM7.7 billion
Duration: 2013-2026
JB-Singapore RTS Link
RM3.7 billion
Duration: 2021-2026
Real Gross Fixed Capital Formation
Annual change (%)
2021
-0.9
2023f
6.0
2022
6.8
Value of work done by early- and mid-stages* in selected construction activities
Avg. 2011-19: 5.5% Non-residential, RM bn (%yoy) Residential, RM bn (%yoy)
202220212020
RM16.8 bn
(-22.9)
RM18.8 bn
(12.2)
RM22.2 bn
(18.1)
RM17.6 bn
(-12.3) RM16.7 bn
(-4.7)
RM 17.8 bn
(6.1)
202220212020
Growth in credit to households and businesses to remain supportive
of economic activity
Credit to the private non-financial sector
continued to expand
3.3 3.8
0.8
0.9
4.1
4.7
2021 2022
Outstanding corporate bonds
Outstanding loans
Credit to the private non-financial sector
Note: Outstanding loans refer to the sum of outstanding business and household loans, and exclude loans to financial institutions, government, NBFIs and other entities. In addition to loans from the banking system and
development financial institutions (DFIs), credit to the private non-financial sector reported here also includes loans to households extended by major non-bank financial institutions (NBFIs). Outstanding corporate bonds
include conventional and Islamic short-term papers in addition to longer-term bonds and sukuk, and excludes issuances by Cagamas, government, financial institutions, and NBFIs.
Source: Bank Negara Malaysia
Going forward, financing conditions to remain
supportive of economic activity
Credit to private non-financial sector
Annual Change (%) / Cont. to growth (ppt)
9
Strong lending capacity among banks, given
healthy capital and liquidity buffers
Continued willingness to lend by banks
Demand for credit supported by continued
economic expansion
Continued improvement in employment and
income
Continued availability of targeted support, including
funds for SMEs
Overall, Malaysia’s economy to grow between 4% and 5% in 2023
Note: p Preliminary, f Forecast
Source: Department of Statistics, Malaysia and Bank Negara Malaysia estimates
Growth underpinned by firm domestic demand amid external headwinds
4% to 5%
(2023f)
Further improvement in
employment and income levels
Higher tourism activity
Continued targeted policy measures
2022p:
8.7%
Continued implementation of
multi-year investment projects
Malaysia GDP Growth
Annual Change (%)
Slowing global growth
Elevated cost of living
& input costs
10
Avg. 2011-19: 5.1%
2021:
3.1%
Risks to Malaysia’s growth outlook are fairly balanced
▼ Sharp tightening in global financial market conditions
▼ Further escalation of geopolitical conflicts
▼ Higher-than-expected inflation and input costs domestically
▲ Better-than expected labour market conditions
▲ Stronger-than-expected pick-up in tourism activity
▲ Implementation of projects including from re-tabled Budget 2023
2023f:
4% to 5%
Downside risks dominated by external factors
Upside risks stem mainly from domestic factors
11
In 2022, inflation was driven largely by higher input costs due to:
o Higher global commodity prices following the military conflict
in Ukraine
o Export restrictions in commodity-exporting countries
o Supply shortages and adverse weather conditions
o Sustained US dollar strength leading to higher import prices
A 5% change in RM/USD is associated with 0.2ppt change in
core inflation over a year
Jan-21 Apr-21 Jul-21 Oct-21 Jan-22 Apr-22 Jul-22 Oct-22 Jan-23
Source: Department of Statistics, Malaysia
Headline inflation
2022: 3.3 (2021: 2.5)
…which coincided with stronger demand conditions amid:
o Pent up demand following the reopening of the economy
o Domestic policies such as revision to minimum wage and
EPF special withdrawals
Inflation
Annual Change (%)
Core inflation
2022: 3.0 (2021: 0.7)
Gradual
reopening of
the Malaysian
economy
Military
conflict in
Ukraine
Transition to
endemicity in
Malaysia
12
EMR 2022 White Box “Revisiting Exchange Rate Pass-Through to Inflation in Malaysia”
Inflation rose in 2022 due to both supply and demand conditions
https://www.bnm.gov.my/emr22s1
Headline and core inflation to average between 2.8% - 3.8% in 2023
Source: Department of Statistics, Malaysia and Bank Negara Malaysia estimates
13
Inflation
Annual Change (%) Both headline and core inflation would
moderate but remain elevated
over the course of 2023
▼ Global cost environment is expected to
ease but input costs would still
remain high compared to pre-pandemic
▲ Continued strength in domestic demand
and improvement in the labour
market
2.5
3.3
2.8 – 3.8
0.7
3.0
2021 2022p 2023f
Headline
Core
Risks to the inflation outlook are tilted to the upside
▼ Weaker global growth leading to more subdued commodity prices
▼ Faster dissipation of domestic pent-up demand from 2022
▲ Higher global commodity prices amid worsening geopolitical conflict
▲ Higher input costs due to exchange rate developments
▲ Stronger-than-expected demand from China
▲ Review of domestic policy on subsidies and price controls
Upside
risks
Downside
risks
Mitigating factor:
Existing domestic price controls and subsidies will continue to partly contain inflationary pressures
14
Monetary policy remains focused on ensuring price stability in support
of sustainable domestic economic growth
The OPR was gradually increased
to 2.75%
Overnight Policy Rate (OPR)
%
1.0
1.5
2.0
2.5
3.0
3.5
2012 2014 2016 2018 2020 2022
Mar 2023:
2.75%
Source: Bank Negara Malaysia
Historical low
OPR level: 1.75%
15
The MPC continues to monitor the
impact of past OPR adjustments on
the economy
Monetary policy will continue to
balance the risks to domestic inflation
and economic growth
So far:
• The impact of the past OPR adjustments on financial
conditions has been orderly
• No signs of excessive tightening in consumption and
investment
• Signs of moderation in the strength of inflationary
pressure amid normalisation of inflation expectations,
but inflation remains elevated
Monetary policy stance to remain
supportive of economic growth
Further normalisation to the degree of monetary policy
accommodation will be informed by evolving conditions
1 The MPC remains vigilant to cost factors, including those arising from
financial market developments, that could affect the inflation outlook
2 Price pressures may be more persistent than expected, and thus it is important
to manage inflation in ensuring sustainable long term growth
3
Any adjustment to the degree of accommodation will be informed by evolving
global and domestic conditions and their implications on the overall outlook of
domestic inflation and growth
16
AR 2022 Article “The Exchange Rate and the Malaysian Economy”
Ringgit movements continue to be mostly driven by USD strength
YTD as of 24 March 2023
Note: Major currencies include EUR,JPY, GBP and AUD, while regional currencies include IDR, KRW,
PHP, SGD and THB
Source: Bank Negara Malaysia
Ringgit’s performance was in line with global
and regional trends and mainly driven by
external factors
Flexibility in the ringgit enables the economy to
adjust to global shocks
RM/USD -5.4% -0.3%
2022 YTD 2023
+8.2% -0.4%US Dollar Index (DXY)
-9.1% +1.0%Major Currencies/USD
-5.1% +1.1%Regional Currencies/
USD
+0.05% -1.3%NEER
Exchange rate performance
17
Orderly adjustments in the ringgit facilitate decisions
to consume and invest
Concerns stem from the impact of depreciation to
higher costs and inflation. So far, this has been
contained by price controls and subsidies
BNM conducts FX operations to stem excessive
volatility and ensure orderly market conditions
During a depreciation, some sectors such as exports
and domestic tourism stand to benefit
Conversely, during an appreciation, those who
import goods, services and travel abroad will benefit
https://www.bnm.gov.my/ar22f1
1 This refers to the day before the plunge in Silicon Valley Bank’s (SVB) equity share price
Data as at 24th March 2023
Source: Bank Negara Malaysia
NR holdings of Government bonds and 10-year MGS yields
3.2
3.4
3.6
3.8
4.0
4.2
4.4
4.6
20
21
22
23
24
Dec-22 Jan-23 Feb-23 Mar-23
% %NR holdings as % of outstanding Govt. bonds (LHS)
10y MGS yields (RHS)
Note: Regional countries include Thailand, Indonesia, Singapore and Philippines
Source: Bloomberg, Bank Negara Malaysia
Silicon Valley
Bank (8 Mar)1
18
Average daily FX turnover
(USD bil)
USD/MYRRegional currency
YTD 2023 1M Volatility
(%)
2022
13.7
YTD 2023
15.4
2021
11.3
8.0% 5.6%
Domestic financial market conditions remain orderly despite recent
banking stress in some advanced economies
Non-resident (NR) holdings of Government
bonds remain stable
Healthy foreign exchange (FX) liquidity with
relatively low FX volatility
Malaysian banking system remains resilient, with ample capacity to
absorb losses under severe simulated downside scenarios
The banking sector maintains healthy levels of
capital and liquidity buffers…
154%
…and is resilient to severely adverse
scenarios2 (AS)
118%
1 Earliest available data for LCR and NSFR is 2015 and 2020 respectively.
Source: Bank Negara Malaysia
AS2
Milder GDP contraction
followed by
slow growth
AS1
Sharp GDP contraction
followed by a
quick recovery
Pre-shock
Banking System: Total Capital Ratio under Macro Stress Tests
Minimum requirement: 8%
16.1%18.4%
16.3%
154%
118% Dec’23p3 Dec’25p3
p Projected
2 The scenarios are more severe than the 2008 Global Financial Crisis as well as the 2020 pandemic.
They have been developed specifically for stress testing purposes and do not represent the Bank’s
actual expectations for economic trajectory. As such, these scenarios are unlikely to materialise.
3 The year with the lowest level of total capital ratio across the 3-year stress test horizon.
19
2022
Liquidity Coverage Ratio
(LCR)1
2008 2020
Net Stable Funding Ratio
(NSFR)1 116%
2015
125% 148%
Banking System: Key Indicators
154%
118%
Total Capital
Ratio 16.7% 18.9%12.6% 18.8%
Households and businesses repayment capacity have improved but
pockets of risks remain
Share of risky loans1 declined closer to pre-pandemic
level amid improving income and economic conditions
Some borrowers continue to face repayment
challenges, but support remains available
Households with higher debt service burdens,
especially among the lower-income group
Self-employed or employed in the vulnerable sectors2
Sectors facing higher operating costs
SMEs with thinner cash buffers11.4%
14.7% 13.2%
Dec '19 Jun '22 Dec '22Businesses
Households
1 Refer to loans classified as Stage 2 as a percentage of total household or business loans. Stage 2 loans refer to exposures that have exhibited deterioration in credit risk, for which banks are required to set aside provisions
based on lifetime expected credit losses under Malaysian Financial Reporting Standard 9.
2 Refer to those who are employed in economic sectors that are still recovering from the pandemic.
Source: Bank Negara Malaysia
Share of Risky Loans to Total Household Loans
Share of Risky Loans to Total Business Loans
5.8% 8.0% 6.7%
Dec '19 Jun '22 Dec '22
20
Crucial to seize opportunities to implement key structural
reforms in enhancing Malaysia’s growth potential and competitiveness
Enhance
competitiveness
Transition to higher
income nation
Rebuild buffer against
future shocks
Alleviate cost of living
concerns
Key policy priorities to strengthen the economy
Policy
Priorities
Growth Potential
Attract quality investments under the
New Investment Policy
Digitalisation
Expedite digitalisation efforts in MyDIGITAL,
INDUSTRY4WRD, and digital financial services
Future-Ready Workforce
Reskilling and upskilling via Active
Labour Market Policies (ALMPs)
Social Protection
Facilitate the interlinkages between
three pillars of social protection
Fiscal Resilience
Fiscal Responsibility Act and
gradual subsidy rationalisation
Climate Resilient Economy
Accelerate transition to low-carbon
economy and build climate resilience
21
Timely implementation of the New Investment Policy is key to attract
and retain quality investment (FDI & DDI)
Enhancing the investment ecosystem is critical
to attract and retain investors
Malaysia needs to adjust as global trade and
investment megatrends continue to evolve
22
Enhance investment targeting and
promotion of key strategic sectors
Reconfiguration of global supply chains
Shrinking and competitive global FDI inflow
Develop dynamic and agile
incentive packages
Mainstreaming of responsible investments
Climate transition
Accelerated automation and digitalisation
Cohesive functioning and coordination
among all investment promotion agencies
Automate tax incentive administration system
Outcome-based incentive design
Strengthen ESG practices
Clear standards and strengthened
regulation for ESG disclosure
Strategies under the New Investment Policy include:
Source: New Investment Policy, MITI and Bank Negara Malaysia
Reforms to the social protection framework are important to address
economic fragilities, facilitated by a multi-pillar approach
Social safety nets Active Labour Market
Policies (ALMPs)Social insurance
Fragilities exacerbated by the pandemic…
Low incomes Low retirement savings
…to be addressed by multi-pillar social protection framework
Promote social
mobility
Improve standard
of living
Maximising
efficiency of
spending
Outcome of a multi-pillar social
protection framework
1 2 3
23
EMR 2022 Article “Rebuilding Retirement Savings and Financial Safety Nets for Malaysia”
Necessary reforms to ensure Malaysia's retirement savings
framework is future-ready
Priority should be accorded to address the most pressing gaps
• Insufficiency of old-age assistance
• Lack of job opportunity for the old-age
groups to re-enter the job market
• Limited access to social protection for
workers in the informal sector
Sufficiency: Savings adequacy
Exclusion: Access to social protection
Adaptability: Gaps in old-age assistance
and labour market frictions
Gaps in the current retirement savings framework Saving Our Tomorrow: Reforms for A Better Future
Ringfencing of retirement funds
• Allow for greater accumulation of savings
alongside structural reforms to boost incomes
Enhancing old-age assistance and labour
participation
• Linking old-age assistance to standard of living
• Hiring incentives for old-age workers
Unlocking the potential of data
• Universal registration into EPF and SOCSO to
identify needs for uncovered segments
• Enable linking of cash assistance with upskilling
programmes
24
• Low number of EPF members meeting
the Basic Savings threshold
https://www.bnm.gov.my/emr22b1
Financial scams have become a significant problem globally
25
USD55.3 billion
estimated losses to
online scams in 20221
1 Global State of Scams Report – 2022, Global Anti-Scam Alliance
2 WEF Global Risk Report 2020
0.05%
likelihood of detection
and prosecution of
scammers in US2
Key countermeasures implemented to combat financial scams and
ensure the banking and payment systems remain safe
26
These enhanced security measures may cause temporary inconvenience, but they are essential to protect consumers
• Conduct call-back verifications
• No clickable hyperlinks in SMS
• Tip-offs to MCMC to take down
scam websites, advertisements,
and social media accounts
• Appoint Senior Independent
Directors to oversee handling of
fraud and data breach incidents
• Work with NSRC for faster tracing
and interception of stolen funds
• Continuous efforts to raise public
awareness of scam tactics, and
familiarise users of online banking
with the enhanced security features
Other measures by the industryCountermeasures announced by BNM
Prevent scammers from reading
(and deleting) victim’s SMS
OTPs via phishing or malware
Further tightening
of detection rules
and triggers
Banks can detect and block
evolving scam-related
transactions whilst reducing
false alarm
Cooling-off period for
first-time enrolment of
online banking services
& secure devices
Consumers have some time
to take action for fraudulent
registration by scammers due
to stolen banking credentials
and SMS OTP
Only one mobile/secure
device to authenticate
online banking transactions
Prevent scammers from activating
online banking from new device
without victim’s knowledge
Dedicated
scam hotlines
Victims can promptly contact
banks to report scam incident
Kill switch
Victims can freeze their
banking accounts temporarily
to stop further loss of funds
2 3
4
Migration from SMS
One Time Password to
more secure forms of
authentication
5
1
6
1 AR 2022 Article “Driving into the Future – A Digital Motor Claims Journey”
A vibrant digital financial services landscape to maximise
efficiency gains and better serve consumers
General ITOs have committed to implement the first phase (i.e. roll-
out of digital roadside assistance solutions, DRA) by end-2023
DBs and DITOs are expected to deliver greater
inclusion, market competition and efficiency
End-to-end digital motor claims journey will
transform the consumer experience1
27
overcoming
geographical barriers.
utilising innovative
technology
prioritising user
experience
Digital banks (DBs) enhance provision of banking services by…
The five DBs are on track to begin operations by Q2 2024
Inclusion Competition Efficiency
Digital insurers and takaful operators (DITOs) are expected to promote
Up to five licenses may be offered once DITO policy
document issued in 2023
Request for
DRA via web
and/or
mobile app
Monitor
registered
tow truck’s
location
Choose
preferred
workshop
Lodge
claims and
photo/video
evidence
digitally
Keep track
of repairs
status
Step 1
Step 2
Step 3
Step 4
Step 5
Timeliness Transparency
Transformative
Customer
Experience
Desired outcomes
https://www.bnm.gov.my/ar22f2
1 AR 2022 Article “Empowering Communities with Digital Financial Services”
2 AR 2022 Article “Cross-Border Payment Linkages – Project Nexus and the Push for a Multilateral Approach”
Digital payments continue to accelerate amid intensified efforts to
secure cheaper, faster and more transparent cross border payments
BIS Project Nexus2 affirms that instant cross-border P2P transfer
using just a mobile number can be scaled up to a multilateral level
QR linkage with Singapore is live on 31 March 2023; builds on
existing Thailand and Indonesia linkages
ASEAN-5 envisages real-world application of Nexus solution by
2025
Efforts to enhance cross border payments are gathering pace,
with immediate focus in ASEAN
In collaboration with:
Retail payment
purchases
2022
41%
growth
Merchant registration
(DuitNow QR)
2022
45%
growth
Sustained growth in e-payment
adoption domestically
…supported by continued efforts to
promote safe use of e-payments1
Bilateral payment linkage:
Multilateral payment linkage:
28
291
Annual e-payment
per capita
(2022)
https://www.bnm.gov.my/ar22f3
https://www.bnm.gov.my/ar22s4
FOCUS on security
features of websites
and apps
ESCAPE from
financial scammers
ACT proactively to
protect devices
AR 2022 Article “Let’s Go Digital Confidently”
Empowering consumers with digital financial literacy to
support the safe usage of digital financial services (DFS)
The Bank continues to improve consumers' digital financial literacy focusing on 3 key messages
leveraging on various engagement platforms1
1 Financial education talks, roadshows, competitions, social media
1
29
1 Motivation to
use DFS
1) Secure - DFS is subject to evolving security
measures to protect personal information and data
2) Simple - Easy monitoring of personal finances
3) Swift - 24/7 access to financial services
2
Be Smart Online
Financial
Consumers
1) Online tools and resources to manage personal finances
conveniently and safely
2) Online investments to build wealth progressively
3) Constantly build knowledge to protect against scams
13
Tips to be
SAFE online
1) Safeguard personal information and banking details
2) Practise good cyber-hygiene to be safe online
3) Take immediate actions if being scammed to reduce
financial losses
SECURE personal
informationS
A
F
E
https://www.bnm.gov.my/ar22f6
Policy already in place
Policy currently under planning
No policy in place
Policies
National
Net Zero
Target
Net-zero
Policy
Framework
&
Legislation
Carbon
Market
Mechanism
Carbon
Tax
Singapore
Indonesia
Thailand
Malaysia
Philippines
EMR 2022 Article “Navigating Malaysia’s Economic Transition towards a Decarbonised Future”
An orderly transition to a green economy will allow Malaysia’s
growth to become more resilient, sustainable and inclusive
A suite of mitigation measures can be
considered to encourage an orderly transition
Regulation
Legislate Climate Change Act
Develop sectoral pathways (LT-LEDS)
Price Reforms
Rationalise fossil fuel subsidies and
redirection to renewable energy
Leadership and
Governance
Prioritise low carbon procurement
Investment
Scale up R&D and commercialisation of
green technologies
Awareness and
Capacity Building
Promote public awareness on carbon
capture, palm-based feedstock and bio-
based solutions
30
Regional economies are moving ahead to
implement climate policies
By 2050
By 2060
By 2065
By 2050
75% below BAU
by 2030
Source: Various news flows, Grantham Research Institute on Climate Change and Environment
https://www.bnm.gov.my/emr22b3
Clear, consistent and credible carbon
accounting framework as critical enabler
• Measurement of credible GHG emissions
targets
• Baseline to develop and scale market
mechanisms e.g. compliance carbon
markets
Growing demand for climate-related
disclosures
• Facilitate access to funds and capital
• Address green washing
Nature- and climate-related risks are closely
connected
• Nature loss reduces resilience to climate change
• Climate change is a driver of nature loss
Banking sector is indirectly dependent on
ecosystem services
• 54% of commercial lending exposed to physical risk
• 87% of commercial lending channeled to sectors that
‘highly’ or ‘very highly impact’ natural assets and
ecosystem services
Current climate-related risk strategies can be building blocks
for FIs to respond to nature-related financial risks
AR 2022 Articles “Measuring the Journey towards a Low Carbon Economy” & “Biodiversity Loss: Implications on the Economy and Financial Stability”
Need for carbon accounting framework and response to biodiversity
loss to support and complement climate action
Carbon accounting as a critical enabler for transition Biodiversity loss has significant implications on the
economy and financial stability
31
Malaysia ranked 12th on National Biodiversity Index
https://www.bnm.gov.my/ar22f4
https://www.bnm.gov.my/ar22f5
1 FSR 2022 Article “Transmission Vulnerabilities in the Commodity Market to the Islamic Banking System through Tawarruq Transactions”
2 AR 2022 Article “MIFC Leadership Council: Galvanising Greater Industry Stewardship” & “Fostering International Connectivity among Central Shariah Boards in
Islamic Finance”
Strategic priorities for Islamic finance towards resilient, sustainable
and inclusive growth
32
Modernising Shariah contracts application to spur innovation in
addressing contemporary economic and social needs1
Mainstreaming value-based finance and improving impact measures
to achieve greater ecosystem alignment in VBI implementation
Strengthening ecosystem enablers to advance digitalisation of Islamic
financial sector and deepen Islamic financial market and liquidity
Positioning Malaysia as an international gateway for Islamic finance
with stronger industry stewardship to foster greater market dynamism2
https://www.bnm.gov.my/fsr22h2b2
https://www.bnm.gov.my/ar22s3
https://www.bnm.gov.my/ar22s2
https://www.bnm.gov.my/ar22s2
Bank Negara Malaysia: Financial position remained stable in 2022
RM619.04 bn
Total
Assets
RM503.33 bn
USD114.6 bn
International
Reserves
RM6.99 bn
Net
Profit
RM2.75 bn
Dividend
paid to the
Government
33
Summary
The Malaysian economy is projected to expand between 4% and 5%
in 2023, anchored by firm domestic demand
Both headline and core inflation are projected to average
between 2.8% and 3.8%
Risks to the growth outlook are fairly balanced,
with downside risks emanating primarily from external factors
Capital and liquidity positions of banks remain sound
to absorb potential shocks and support intermediation
Implementation of key structural reforms is important
to ensure sustainable growth going forward
34
35
box articles across our three publications
on various themes and topical issues18
Learn more at bnm.gov.my/AR2022
… and many more
https://www.bnm.gov.my/ar2022
Q & A
32
WIP
36
Questions & Answers
3237
Additional Information
2022: Higher growth across most economic sectors
GDP Growth by
Economic Activity
(Annual Change, %)
%
Share
(2022p)
2021 2022p 2023f
Real GDP 100 3.1 8.7 4.0 –
5.0
Services 58.2 1.9 10.9 5.0
Manufacturing 24.2 9.5 8.1 4.0
Mining & Quarrying 6.4 0.3 3.4 2.0
Agriculture 6.6 -0.2 0.1 0.7
Construction 3.5 -5.2 5.0 6.3
1.1
6.2
2.9
2.2
2.0
1.0
0.2
0.1
-0.2
0.2
0.2
2021 2022p 2023f
Services
Manufacturing
Mining & Quarrying
Agriculture
Construction
Malaysia GDP Growth by Economic Activity
Annual Change (%), Ppt. Contribution
Note: p Preliminary, f Forecast
Source: Department of Statistics, Malaysia and Bank Negara Malaysia estimates
Real GDP:
3.1% 8.7% 4.0% - 5.0%
38
1.1
6.6
3.7
0.4
1.1
0.9
0.7
0.5
0.2
-0.6
0.2
0.3
-0.3
-0.1
0.5
1.7
0.3
-1.2
2021 2022p 2023f
Private Consumption
Private Investment
Public Consumption
Public Investments
Net Exports of Goods & Services
Change in Stocks
2022: Improvement across most demand components
Note: p Preliminary, f Forecast, 1 Excluding stocks
Source: Department of Statistics, Malaysia and Bank Negara Malaysia estimates
GDP Growth by
Expenditure
Components
(Annual Change, %)
%
Share
(2022p)
2021 2022p 2023f
Real GDP 100 3.1 8.7 4.0 –
5.0
Domestic Demand1 93.1 1.7 9.2 5.4
Private Consumption 60.2 1.9 11.3 6.1
Private Investment 15.4 2.6 7.2 5.8
Public Consumption 13.2 5.3 3.9 1.3
Public Investment 4.4 -11.3 5.3 7.0
Net Exports of
Goods and Services 5.4 -4.1 -1.8 9.7
Exports 71.7 15.4 12.8 2.7
Imports 66.3 17.7 14.2 2.1
Malaysia GDP Growth by Expenditure Components
Annual Change (%), Ppt. Contribution
Real GDP:
3.1% 8.7% 4.0% - 5.0%
39
Negative output gap is expected to turn positive in second half of 2023,
with actual output averaging close to the potential output for the year
Note: e Estimate, f Forecast
Source: Department of Statistics, Malaysia and Bank Negara Malaysia estimates
Actual Output and Potential Output Growth Output Gap
0.6
1.5
-3.0
-2.5
-0.4
2018 2019 2020 2021 2022e 2023f
% Share of Potential OutputAnnual Change (%)
40
4.8 4.4
-5.5
3.1
8.7
4.1
3.5
-1.2
2.7
6.4
2018 2019 2020 2021 2022e 2023f
Actual Output
Potential Output
4.0 - 5.0
3.5 - 4.5
Continued growth in potential output, supported
by expansion in factors of production
1
Labour Force
Expansion
-0.5 to 0.5
Closing of output gap is driven by higher actual output
growth outpacing potential output growth
3
Productivity
Improvement
2
Capital
Accumulation
Factors of Production
Current account to remain in surplus within 2.5% - 3.5% in 2023
Note: G3 includes the US, the euro area and Japan. Newly Industrialised Economies (NIEs) refers to Hong Kong SAR, Korea and Chinese Taipei.
Source: Department of Statistics, Malaysia and Bank Negara Malaysia estimates
Current account surplus driven by continued
goods surplus and lower services deficit
Diversified export products and markets to
cushion potential external shocks
41
3.8
2.6
-90
-40
10
60
110
160
210
260
-0.5
0.5
1.5
2.5
3.5
4.5
2021 2022 2023f
Current Account Balance
% of GDP
Goods
Surplus
Income
Deficit
Services
Deficit
Current
Account
Balance
Exports by Products and Markets (2022)
% Share of Total Exports
Markets
ASEAN,
29%
China,
14%
NIEs,
13%
G3,
25%
ROW,
19%
Products
E&E,
38%
Non-E&E
(Resource based),
24%
Mining,
8%
Agriculture,
8%
Non-E&E
(Non-resource based),
22%
Adequate buffers to weather external shocks
Malaysia remained in a net
creditor position
Large FCY assets to compensate
for potential claims on liabilities
Further support from foreign
income and international reserves
-5.0
-2.6
5.7 5.5
3.5
2018 2019 2020 2021 2022
Net debtor
position
Net creditor
position
2,118
957
FCY Assets FCY Liabilities
Net International Investment Position
Share of GDP (%)
FCY-Denominated External Assets &
Liabilities (End-2022)
RM billion
Sustained foreign income
Continued current account surplus
reduces external financing
requirements
Sufficient international
reserves to facilitate
international transactions
… to finance 5.0 months of imports
of goods & services and is 1.0 time
total short-term external debt as at
15 March 2023
42
Banks to continue supporting SMEs’ business needs and expansion
Forthcoming disbursements for
working capital and investments
. . . and robust approvals
driven by investment purposes
14.9
22.7
1.0
3.4
17.3%
26.7%
2021 2022
Working Capital
Investment-related*
Others 42
1H21 2H21 1H22 2H22
*Includes loans for the purchase of non-residential property, residential property for business use, vehicles, machinery & equipment and other fixed assets, and construction activity.
Note: Data refers to loan/financing from the banking system and development financial institutions (DFIs), which is based on updated statistical reporting requirements and may not be directly comparable to the data reported
in previous Annual Report publications.
Source: Bank Negara Malaysia
BNM’s Fund for SMEs to continue
supplementing financing for SME
growth
SME Financing Disbursements
Overall growth:
Annual growth (%) / Contribution to growth (ppt)
SME Financing Approvals
RM bn
Investment-related*
Working capital
37
1H21 2H21 1H22 2H22
2018-19 half-yearly average
Enhancements to BNM’s Fund for SMEs in Budget 2023
Increase agrofood production for local
and export purposes
Agrofood FacilityRM2.5 bn
(+RM500 mil)
Automation & Digitalisation Facility
Encourage SMEs to automate
processes and digitalise operations
RM1.5 bn
(+RM500 mil)
Support SMEs and innovative start-ups
to invest in strategic sectors and
technology fields
High Tech & Green Facility
RM1.1 bn
(+RM300 mil)
remains available
as at 14 March 2023RM9.7 bn
43
44
November 2022 – January 2023 February 2023 – Current
Expectations of slower rate hike in US alongside rate
cuts in 2023
15.6
15.3
14.3
10.6
10.3
8.1
7.8
7.2
6.1
4.1
2.4
1.1
KRW
THB
JPY
MYR
AUD
CNY
SGD
TWD
PHP
IDR
CAD
INR
Softening of commodity prices amidst recessionary
concerns
China’s reopening provided optimism to the global
economy
Repricing of higher Fed Funds terminal rate following
strong US economic data, although recent global banking
concerns have somewhat dampened rate hike expectations
FX Movements vs USD (%)
Ringgit strengthened from Nov’22 to Jan’23 following downward
FFR repricing but weakened since then, in line with other currencies
Note: While the JPY initially weakened in
line with THB, MYR AUD and KRW, it then
strengthened significantly beginning 8th
March 2023 on safe haven trade amid SVB
and Credit Suisse concerns
0.6
-0.5
-0.7
-1.0
-1.1
-1.4
-1.6
-3.2
-3.3
-3.5
-4.8
-5.8
PHP
JPY
INR
TWD
IDR
SGD
CNY
CAD
THB
MYR
KRW
AUD
45
While banking shares globally have come under pressure since banking
stress in AEs, Malaysian banks have not been impacted as much
1 Additional Tier 1 (AT1) bonds are a form of subordinated capital instruments that
qualify for regulatory capital
Source: Bloomberg as at 24th March 2023
-1.0
-2.2
-4.1
-4.1
-5.7
-11.4
-12.8
-13.4
-14.3
-16 -14 -12 -10 -8 -6 -4 -2 0
SG
HK
MY
IN
KR
US
EU
UK
JP
Financial sector index returns since 8 March 2023
(%)
KLCI Financials Index fell by only -4.1%, compared to
the steeper declines especially among major advanced
economies (AEs)
1
Malaysian banks’ depositor base is more diversified than
the troubled US banks. Additionally, bonds comprised
only around 10% of Malaysian banking assets
2
Besides that, Malaysian banks have limited exposure to
the troubled US and Swiss banks
3
Malaysian banks’ senior unsecured and AT11 bond prices
have also been stable, reflecting the absence of any
confidence issues among investors
4
Limited impact from banking sector stress in US and Europe
on Malaysian banks
Malaysian banks have a smaller proportion of AC
bonds and diversified depositor base
Banks’ capital and liquidity levels remain resilient
even if MTM losses from AC bonds were to be
deducted2
MY: Malaysia; SVB: Silicon Valley Bank; NR: Non-resident; NBFI: Non-bank financial institution.
1 Data as at December 2022.
Source: Bank Negara Malaysia, Bank Negara Malaysia estimates
Resultant
Total Capital
Ratio
Initial
Total Capital
Ratio
The Mark-to-Market Impact on Banks'
Total Capital Ratio from Banks' Bonds
Held as Amortised Cost
18.2%
2 The sensitivity analysis conducted has incorporated the impact of mark-to-market losses if the bonds
in banks' AC portfolio are revalued to reflect a 200bps rate shock and the resultant losses are deducted
from banks’ capital (although Basel III capital rules do not require this).
17.1%
Bonds Held as Amortised Cost
% of Total Assets
6.7%
43.1%
MY SVB
Individual
38%
Business
34%
NBFI
10%
NR
6%
Others
12%
Deposit Composition of Malaysian Banks1
% of Total Deposits
Liquidity Coverage Ratio1
%
154%
RM753.4
bn
High-Quality Liquid Assets1
RM billion
Minimum requirement: 8%
46
Household indebtedness remains elevated, but loan repayment capacity
has improved amid better economic conditions
82.8
93.1 89.1
81.2
88.2
69.7
16.9
Dec '19 Dec '20 Dec '21 Dec '22 TH SG ID
TH = Thailand; SG = Singapore; ID = Indonesia
1 Data as at: Thailand (Jun-22p), Singapore (Sep-21), Indonesia (Mar-22). Household debt-to-GDP ratio for Indonesia covers household debt from the banking system only, while for Thailand and Singapore, it
covers household debt from banks and non-banks.
Source: Bank Negara Malaysia, Bank of Thailand, Monetary Authority of Singapore, Bank of International Settlements.
Household debt-to-GDP reached pre-pandemic level,
but remained elevated compared to its peers
Nevertheless, loan repayment has improved
amid better income and employment conditions
Household Debt-to-GDP
%
Malaysia Regional Economies1
5.8
8.0
6.7
Dec '19 Jun '22 Dec '22
Proportion of Stage 2 Loans to Total Households Loans
%
47
Financial stability risk from the buy-now-pay-later (BNPL) schemes
remained limited, but conduct risk is a concern
The bulk of BNPL users are from the youth and lower-income
segments but risks remained limited given small exposures
1 Based on data of four largest non-bank BNPL players that accounted for 96% of transaction value in 4Q 2022.
2 Only selected BNPL players provide income information.
3 As at 4Q 2022, the average total amount spent by an active BNPL account holder is RM545.20.
Nonetheless, potential conduct
risks remain
conduct more holistic suitability and
affordability assessment on new customers
of total household debt
BNPL exposures3 account
for only
Therefore, the Bank requires financial institutions4
and approved e-money issuers to…
improve disclosures of all applicable fees
and charges to BNPL users
demonstrate reasonable late payment
charges
adhere to the existing responsible lending
standards
<1%
4 Refer to banks and prescribed development financial institutions (DFIs).
Source: Bank Negara Malaysia
2 in 5
BNPL users are youth
and
4 in 5
BNPL users earn <RM3,000 a month
48
Insurers and Takaful Operators (ITOs) remained strong
Excess Capital
Aggregate Capital Adequacy Ratio
ITOs maintained buffers that are well
above regulatory minima…
… and continue to remain resilient even under
severely adverse scenarios1 (AS)
p Projected
1 The scenarios are more severe than the 2008 Global Financial Crisis as well as the 2020 pandemic. They have been developed
specifically for stress testing purposes and do not represent the Bank’s actual expectations for economic trajectory. As such, these
scenarios are unlikely to materialise.
2 The year with the lowest level of capital adequacy ratio across the 3-year stress test horizon.
AS2
Milder GDP contraction
followed by
slow growth
AS1
Sharp GDP contraction
followed by a
quick recovery
Insurance Sector: Capital Adequacy Ratio under Macro Stress Test
Minimum requirement: 130%
144%
215% 164%
Pre-shock
Minimum requirement: 130%
216%254% 211%
General insurers
Life insurers
226%
(Jun ‘22: 224%)
RM37.5 bn
(Jun ‘22: RM35.8 bn)
2023p2 2025p2
2023p2 2024p2
Source: Bank Negara Malaysia
49
Under adverse scenario, losses in the banking system and insurance
sector are largely driven by credit and market risks
non-SMEs
SMEs
household
49%
35%
16%
65% 61%
30%
25%
4%
14%
Life Insurers General Insurers
Insurers: Key Loss Drivers under AS2Drivers of Credit Losses under AS2
1 Refer to losses from credit risk (including reinsurance and corporate bonds default) and underwriting risk.
Source: Bank Negara Malaysia
Market risk
Insurance risk
Others1
RM 94
billion
Higher credit losses in banking sector mainly
driven by household segment
Erosion in insurers’ capital mainly due to
investment and operating losses
Banks: Key Loss Drivers under AS2
37%
Market risk
63%
Credit risk
50
Malaysia continues to be recognised as a global leader in Islamic finance
51
Sustained growth domestically & globally
13.4%
Share of takaful
fund assets to
total fund assets
40.3%
Share of global
sukuk outstanding
81.2%
Listed securities
on KLSE are
Shariah-compliant
(as at Nov 2022)
…with diverse players in the ecosystem and
conducive business environment
Family takaful
operators
General takaful
operators
Retakaful
operators
ICBU1
Enhancing value-based impact of Islamic finance
to economy, society and environment
Mainstreaming value-based finance
Mainstreaming social finance
Sharpen Malaysia’s proposition as global
gateway
• Scale up iTEKAD nationwide – 1595 participants (2021: 721); 10
banks (2021: 3)
• Pilot social takaful for inclusive protection of “at-risk” segments
• MIFC Leadership Council plans to implement work programmes in 5
key areas
Malaysia as preferred Islamic fund raising and investment
destination, addressing inequality, promoting sustainability,
elevating human capital and knowledge, and digital
empowerment
• Strengthen CSAA2 platform for greater connectivity and mutual
recognition in Shariah
1 International Currency Business Units
2 Centralised Shariah Advisory Authorities in Islamic Finance
Source: Bank Negara Malaysia, MIFC estimates, Securities Commission
44.5%
Share of total
financing & loans
(with DFIs)
16 12 6
Islamic banks Islamic windows Dev. financial
institutions
1
International
Islamic bank
16
ICBU1
57 > 68 > 60
Islamic fund
managers
Training &
education entities
Ancillary services (e.g.
legal, Shariah firms)
11 4 3 8
• Improve quality of impact measures
• Pilot more value-based solutions using more diverse Shariah contracts
AR 2022 Article “Banknote Counterfeiting in Malaysia: Trends, Challenges and Strategies”
Low incidence of currency counterfeiting in Malaysia due to the
Bank's active role in implementing anti-counterfeiting strategies
International Counterfeiting Benchmark Index = 15 ppm
Counterfeit index (ppm)
Resilient notes
Robust security features that are subject to review every 1-2 years
Collaboration with the enforcement agency
Working closely with PDRM to investigate and act against perpetrators of
currency counterfeiting
Active awareness programmes
Educate the public to identify genuine and counterfeit notes
Robust currency processing
Counterfeit notes are quickly detected and removed
Clear standards and guidelines
Clear standards to FIs and registered currency processors (RCPs)
Ongoing machine recalibration
Ensure cash machines and ATMs are calibrated to meet minimum
authentication standards
1.6
1.5
1.9
1.4
1.1
0.8
1.2
0.8
0.3 0.3
0
0.5
1
1.5
2
2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
15
52
ppm = parts per million
Malaysia’s note counterfeiting index is
significantly lower than the international
counterfeiting benchmark index and trending
downwards…
… which are supported by six effective anti-
counterfeiting strategies
https://www.bnm.gov.my/ar22s5
Follow the Amaran Scam Facebook page to get the latest scams
tactics
53
Slide Number 1
Overview: �Malaysian economy to expand in 2023, albeit at a more moderate pace
Global economy facing a challenging and uncertain landscape
Slide Number 4
Household spending underpinned by continued income growth
Sustained improvement in labour market conditions
EMR 2022 Article “Analytical Approaches to Assessing Labour Market Conditions and Implications to Monetary Policy”�Enhanced surveillance tools suggest limited risk of excessive �wage pressures
Investments supported by continued capacity expansion �and multi-year projects
Growth in credit to households and businesses to remain supportive of economic activity
Overall, Malaysia’s economy to grow between 4% and 5% in 2023
Risks to Malaysia’s growth outlook are fairly balanced
Slide Number 12
Headline and core inflation to average between 2.8% - 3.8% in 2023
Risks to the inflation outlook are tilted to the upside
Monetary policy remains focused on ensuring price stability in support of sustainable domestic economic growth
Further normalisation to the degree of monetary policy accommodation will be informed by evolving conditions
AR 2022 Article “The Exchange Rate and the Malaysian Economy”�Ringgit movements continue to be mostly driven by USD strength
Domestic financial market conditions remain orderly despite recent banking stress in some advanced economies
Malaysian banking system remains resilient, with ample capacity to absorb losses under severe simulated downside scenarios
Households and businesses repayment capacity have improved but pockets of risks remain
Crucial to seize opportunities to implement key structural �reforms in enhancing Malaysia’s growth potential and competitiveness
Timely implementation of the New Investment Policy is key to attract and retain quality investment (FDI & DDI)
Reforms to the social protection framework are important to address economic fragilities, facilitated by a multi-pillar approach
EMR 2022 Article “Rebuilding Retirement Savings and Financial Safety Nets for Malaysia”�Necessary reforms to ensure Malaysia's retirement savings framework is future-ready
Financial scams have become a significant problem globally
Key countermeasures implemented to combat financial scams and ensure the banking and payment systems remain safe
1 AR 2022 Article “Driving into the Future – A Digital Motor Claims Journey”�A vibrant digital financial services landscape to maximise �efficiency gains and better serve consumers
1 AR 2022 Article “Empowering Communities with Digital Financial Services”�2 AR 2022 Article “Cross-Border Payment Linkages – Project Nexus and the Push for a Multilateral Approach”�Digital payments continue to accelerate amid intensified efforts to secure cheaper, faster and more transparent cross border payments
AR 2022 Article “Let’s Go Digital Confidently”�Empowering consumers with digital financial literacy to �support the safe usage of digital financial services (DFS)
EMR 2022 Article “Navigating Malaysia’s Economic Transition towards a Decarbonised Future”�An orderly transition to a green economy will allow Malaysia’s �growth to become more resilient, sustainable and inclusive
AR 2022 Articles “Measuring the Journey towards a Low Carbon Economy” & “Biodiversity Loss: Implications on the Economy and Financial Stability”�Need for carbon accounting framework and response to biodiversity loss to support and complement climate action
1 FSR 2022 Article “Transmission Vulnerabilities in the Commodity Market to the Islamic Banking System through Tawarruq Transactions”�2 AR 2022 Article “MIFC Leadership Council: Galvanising Greater Industry Stewardship” & “Fostering International Connectivity among Central Shariah Boards in Islamic Finance”�Strategic priorities for Islamic finance towards resilient, sustainable and inclusive growth
Bank Negara Malaysia: Financial position remained stable in 2022
Summary
18
Q & A
Slide Number 37
Slide Number 38
Slide Number 39
Negative output gap is expected to turn positive in second half of 2023, with actual output averaging close to the potential output for the year
Current account to remain in surplus within 2.5% - 3.5% in 2023
Adequate buffers to weather external shocks
Banks to continue supporting SMEs’ business needs and expansion
Ringgit strengthened from Nov’22 to Jan’23 following downward �FFR repricing but weakened since then, in line with other currencies
While banking shares globally have come under pressure since banking stress in AEs, Malaysian banks have not been impacted as much
Limited impact from banking sector stress in US and Europe �on Malaysian banks
Household indebtedness remains elevated, but loan repayment capacity has improved amid better economic conditions
Financial stability risk from the buy-now-pay-later (BNPL) schemes remained limited, but conduct risk is a concern
Insurers and Takaful Operators (ITOs) remained strong
Under adverse scenario, losses in the banking system and insurance sector are largely driven by credit and market risks
Malaysia continues to be recognised as a global leader in Islamic finance
Slide Number 52
Follow the Amaran Scam Facebook page to get the latest scams tactics
| Press Release |
23 Mar 2023 | BIS’s Project Nexus prototype successfully links Eurosystem, Malaysia and Singapore payments systems; partners in Indonesia, Malaysia, the Philippines, Singapore and Thailand to work towards wider payments connectivity | https://www.bnm.gov.my/-/nexus-prototype-success | null | null |
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BIS’s Project Nexus prototype successfully links Eurosystem, Malaysia and Singapore payments systems; partners in Indonesia, Malaysia, the Philippines, Singapore and Thailand to work towards wider payments connectivity
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BIS’s Project Nexus prototype successfully links Eurosystem, Malaysia and Singapore payments systems; partners in Indonesia, Malaysia, the Philippines, Singapore and Thailand to work towards wider payments connectivity
Embargo :
For immediate release
Not for publication or broadcast before
1700 on
Thursday, 23 March 2023
23 Mar 2023
To enhance cross-border payments, the BIS Innovation Hub Singapore Centre developed the Nexus concept of a first-of-its-kind multilateral network connecting multiple domestic instant payment systems (IPSs).
Nexus prototype successfully connected the test IPSs of the Eurosystem, Malaysia and Singapore, allowing payments to be sent across the three using only mobile phone numbers.
In the next phase, BIS and the central banks of Indonesia, Malaysia, Philippines, Singapore and Thailand will jointly work towards connecting their domestic IPSs through Nexus.
The BIS Innovation Hub Singapore Centre and partners today announced the successful connection of the test versions of three established IPS using the Nexus model and outlined the next phase of the project to work on the real-world potential of a multilateral network that could be scaled up across more countries.
The year-long collaboration included the Bank of Italy, Central Bank of Malaysia (BNM) and Monetary Authority of Singapore (MAS), plus the payment systems operators PayNet and Banking Computer Services (BCS). Test payments were initiated using only the mobile phone numbers or the recipients’ company registration numbers via the Eurosystem’s TARGET Instant Payment System (TIPS), Malaysia’s Real-time Retail Payments Platform (RPP) and Singapore’s Fast and Secure Transfers (FAST) payment system.
The Nexus report, published today, provides details on the early experiments and technical specifications for the multilateral interlinking of payment systems. The success of the experiment paves the way for the BIS Innovation Hub Singapore Centre to explore the practical applications of a distributed multilateral network.
Nexus aims to support the G20 priorities of improving the cost, speed, access and transparency of cross-border payments by connecting domestic IPS across multiple countries through a standardised and multilateral approach. It is designed to accommodate differences between IPS, rather than trying to homogenise them.
For the next phase of the project – in line with their November 2022 Memorandum of Understanding on Cooperation in Regional Payment Connectivity – Bank Indonesia, BNM, Bangko Sentral ng Pilipinas (BSP), MAS and the Bank of Thailand will leverage experiences from Phase I and Phase II of the project towards connecting their countries’ IPS and facilitate cross-border transactions across a combined population of about 500 million people.
The Innovation Hub’s Singapore Centre will collaborate with these central banks to facilitate their design processes, as they aim to connect their domestic payment systems.
Bank Negara Malaysia Assistant Governor Suhaimi Ali said, "Our vision is to realise the shared aspiration for faster, cheaper and more accessible cross-border payments. We are pleased to participate in Project Nexus Phase 3 to realise that vision. Building on the success of the Nexus proof-of-concept, we are well-placed to accelerate the development of this next-generation payment connectivity model to bring significant benefits to the people of Malaysia and Asean."
“I am thrilled at our success in connecting three national payment systems and the potential this indicates for Nexus. It paves the way for further development, and we look forward to collaborating with our partner central banks on the next phase of the project,” said Cecilia Skingsley, Head of the BIS Innovation Hub.
“Improving speed and transparency of retail cross border payments, while reducing their costs, is at the core of the G20 agenda. Banca d’Italia stands by this commitment. The success in connecting three payment systems and the potential this indicates for Nexus, are a key step forward in this direction,” said Banca d’Italia Deputy Governor Piero Cipollone.
“We congratulate the BIS Innovation Hub Singapore Centre and its partners from Italy, Malaysia and Singapore for the successful completion of the Project Nexus Proof-of-Concept. The second phase enabled us to harness the potential of multilateral connectivity of fast payment systems among the first-mover countries in the ASEAN. Building on this momentum, we look forward to working with the BIS and our counterparts in the ASEAN in the enhancement of cross-border real-time retail payments that can facilitate financial integration within the region. With an expanding digital sector and remittances remaining to be important drivers of growth, the Philippines remains committed to its pursuit of necessary reforms for a more seamless global payments landscape. We believe this project is a concrete step in this direction,” BSP Governor Felipe M. Medalla added.
“Project Nexus is revolutionizing cross-border payments by linking multiple fast payment systems to create a globally scalable network. The Bank of Thailand is pleased to be a key part of this project, leveraging our experiences in developing Thailand and Singapore’s groundbreaking ‘PromptPay-PayNow’ linkage. Nexus aims to deliver a fast, efficient, and low-cost alternative for cross-border payments, with user experiences similar to those in domestic payments,” said Siritida Panomwon Na Ayudhya, Assistant Governor, Bank of Thailand.
“Encouraged by the commitment of cooperation in Regional Payment Connectivity sealed during the G20 Indonesia Leaders’ Summit in November 2022, the next phase of Project Nexus will become a key step of our joint work towards wider payments connectivity. Our objective remains to accelerate regional financial inclusion as well as to implement faster, cheaper, more transparent and accessible cross border payment systems that will benefit our nations,” Bank Indonesia Governor Perry Warjiyo said.
“The successful Nexus prototype between Singapore, Malaysia and the Eurosystem is a breakthrough that proves the technical viability of multilateral instant payment systems connectivity. The next phase of work by the central banks of Singapore, Indonesia, Malaysia, Philippines and Thailand will be crucial in laying the foundations for future implementation at scale. ASEAN’s progress in regional payments connectivity puts us in good stead to realise Nexus’ vision for a global instant payments network,” Sopnendu Mohanty, Chief FinTech Officer, MAS, said.
Looking ahead, the BIS and the five central banks envisage that Nexus could eventually be implemented globally. To achieve this, they will aim to establish a Global Advisory Panel of central banks and payment system operators to advise on the project’s development beyond the Southeast Asian region. The Bank of Italy and the European Central Bank will be invited to join this panel.
The BIS also plans to run a webinar on the Nexus proof of concept on 5 April. Registration details to follow.
Bank Negara Malaysia
BIS Innovation Hub
Banca d’Italia
Bangko Sentral ng Pilipinas
Bank Indonesia
Bank of Thailand
Monetary Authority of Singapore
Nexus concept
There are more than 60 instant payment systems around the world, which typically allow people to send money to each other within seconds. However, they are all domestic and international payments remain opaque, slow and expensive. Trying to connect domestic systems bilaterally with other countries would be expensive and complex, generating an exponential number of links.
The Nexus concept is of a standardised and multilateral network designed to accommodate the many differences between national systems. Rather than a payment system operator building custom connections for every new country that it wishes to connect to, it needs to establish only one connection to the Nexus network.
Nexus PoC webinar – 5 April. Registration details to follow.
History of development
Inspired by the pioneering bilateral linkage between Singapore’s PayNow and Thailand's PromptPay, launched in April 2021, the BIS Innovation Hub’s Singapore Centre developed the blueprint for a multilateral cross-border network.
In 2022, the BIS Innovation Hub Singapore Centre and a group of partners – the central banks of Italy, Malaysia and Singapore, plus the payment systems operators of the last two (BCS and PayNet, respectively) developed a successful working prototype, connecting the Eurosystem’s TIPS, Malaysia’s RPP and Singapore’s FAST.
The tests show that payments could be sent across the three jurisdictions using only the recipients’ mobile numbers.
Bank Negara Malaysia
23 March 2023
© Bank Negara Malaysia, 2023. All rights reserved.
| null | Press Release |
22 Mar 2023 | International Reserves of Bank Negara Malaysia as at 15 March 2023 | https://www.bnm.gov.my/-/international-reserves-of-bank-negara-malaysia-as-at-15-march-2023 | https://www.bnm.gov.my/documents/20124/6118085/qb2021q4_en_box_imports.pdf | null |
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International Reserves of Bank Negara Malaysia as at 15 March 2023
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International Reserves of Bank Negara Malaysia as at 15 March 2023
Embargo :
For immediate release
Not for publication or broadcast before
1500 on
Wednesday, 22 March 2023
22 Mar 2023
The international reserves of Bank Negara Malaysia amounted to USD114.0 billion as at 15 March 2023. The reserves position is sufficient to finance 5.0 months of imports of goods and services[1], and is 1.0 time of the total short-term external debt.
[1] Under the previous import coverage measure, reserves is sufficient to finance 6.3 months of retained imports of goods. For more information on the new indicator, please refer to the article on “Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to Imports of Goods and Services” in BNM’s Quarterly Bulletin for the Fourth Quarter of 2021 publication, page 27, which can be accessed at bnm.gov.my/-/quarterly-bulletin-4q-2021 Related Assets
BNM Statement of Assets & Liabilities - 15 March 2023
Bank Negara Malaysia
22 March 2023
© Bank Negara Malaysia, 2023. All rights reserved.
|
Monthly Highlights
Headline inflation declined to 3.4% in March
March 2023
1
3.7 3.4
3.9 3.8
0.00
2.00
4.00
0.0
2.0
4.0
J
a
n
-2
2
F
e
b
-2
2
M
a
r-
2
2
A
p
r-
2
2
M
a
y
-2
2
J
u
n
-2
2
J
u
l-
2
2
A
u
g
-2
2
S
e
p
-2
2
O
c
t-
2
2
N
o
v
-2
2
D
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-2
2
J
a
n
-2
3
F
e
b
-2
3
M
a
r-
2
3
Food & non-alcohol (29.5%) Housing & utilities (23.8%)
Transport (14.6%) Others (32.1%)
Headline inflation (RHS) Core inflation¹ (RHS)
Contribution to Inflation
ppt. contribution %, yoy
1 Core inflation is computed by excluding price-volatile and price-administered items.
Source: Department of Statistics, Malaysia & Bank Negara Malaysia estimates
• Headline inflation declined to 3.4% in March
(February: 3.7%) due mainly to lower inflation for
fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation moderated slightly to 3.8% during
the month (February: 3.9%), driven largely by
lower inflation for food away from home.
1
Robust growth in volume index driven by retail and motor vehicles
Index of Wholesale and Retail Trade
Source: Department of Statistics, Malaysia
• The Index of Wholesale and Retail Trade
(IOWRT) expanded by 10.6% in February 2023
(January: 8.5%).
• The higher growth was driven mainly by retail
sales in non-specialised stores (e.g., department
stores) followed by continued strength in
purchases of motor vehicles amid the ongoing
fulfilment of backlog orders.
• On a month-on-month seasonally adjusted basis,
the index accelerated by 5.5% (January: 0.2%).
9.5 8.510.6
0
10
20
30
40
Feb-
22
Mar-
22
Apr-
22
May-
22
Jun-
22
Jul-
22
Aug-
22
Sep-
22
Oct-
22
Nov-
22
Dec-
22
Jan-
23
Feb-
23
ppt, %yoy
Motor vehicles Retail Wholesale
2.4
5.2
4.4
0
1
2
3
4
5
6
7
Mar-22 Jul-22 Nov-22 Mar-23
Business loans
Household loans
Corporate bonds
Annual growth (%)
Growth in credit to the private non-financial sector moderated
1 Comprises loans to households and non-financial corporations from the
banking system and development financial institutions (DFIs), and corporate
bonds issued by non-financial corporations (including short-term papers).
2 Starting with the publication of December 2022 Monthly Highlights and
Statistics (MHS), this series was introduced to enhance the quality of
financing data. This new data series is available in the MHS Table 2.18.
Source: Bank Negara Malaysia
2.7 2.6 2.7 2.6
1.0 0.6 0.7 0.7
1.0
1.1 1.1 0.9
4.7 4.3 4.5 4.2
Dec-22 Jan-23 Feb-23 Mar-23
Corporate Bonds
Business Loans
Household Loans
Credit to the Private Non-
Financial Sector
Contribution to growth (ppt)
• Credit to the private non-financial sector grew by
4.2% as at end-March (February: 4.5%), attributed
to slower growth in credit to businesses (3.2%;
February: 3.7%).
• While growth in outstanding corporate bonds
moderated (4.4%; February : 5.5%), outstanding
business loan growth was sustained at 2.4%
(February: 2.4%). This was supported by the
continued growth in both working capital (2.2%;
February: 1.9%) and investment-related loans
(4.3%; February: 4.2%).
• Outstanding household loan growth remained
broadly stable (5.2%; February: 5.3%), supported
by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan
growth for the purchase of securities (-6.9%;
February: -3.3%).
Credit to the Private Non-Financial Sector1,2
Monthly Highlights
March 2023
Domestic financial market conditions remained orderly
Financial Market Performance in March 2023
Source: Bank Negara Malaysia, Bursa Malaysia
Note: The exchange rate data is the noon-rate in the Kuala Lumpur Interbank Foreign Exchange Market
11.0
-2.1
-5.3
0.0
-2.2
1.7
10-year MGS
(bps, mom)
Equity
(%, mom)
Ringgit
(%, mom)
-10 -5 0 5 10 15
Mar-23
Feb-23
• In March, global financial markets were affected by
the emergence of banking sector stress in some
major economies. As spillovers were contained thus
far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds
improved.
• In line with the performance of regional currencies,
the ringgit appreciated by 1.7% against the US
dollar. Conditions in the domestic bond market
also remained stable.
• The FBM KLCI declined by 2.2% during the month.
2
Banks maintained strong liquidity and funding positions to support intermediation
Source: Bank Negara Malaysia
Banking System Liquidity and Funding Ratios
81.9
157.4
0
40
80
120
160
70
75
80
85
90
95
M
a
r
2
2
A
p
r
2
2
M
a
y
2
2
J
u
n
2
2
J
u
l
2
2
A
u
g
2
2
S
e
p
2
2
O
c
t
2
2
N
o
v
2
2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
% %
Liquidity Coverage Ratio (RHS)
Loan-to-Fund Ratio
Asset quality in the banking system remained intact
Banking System Asset Quality
Source: Bank Negara Malaysia
• Overall gross and net impaired loans ratios
increased slightly to 1.8% (February-23: 1.8%) and
1.2% (February-23: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory
reserves) continue to record a prudent level of
110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
%
1.8
1.2
1.7
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
M
a
r
2
2
A
p
r
2
2
M
a
y
2
2
J
u
n
2
2
J
u
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2
2
A
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2
2
S
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p
2
2
O
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2
2
N
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2
2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
Gross Impaired Loans Ratio
Total Provisions to Total Loans Ratio
Net Impaired Loans Ratio
• Banks continued to record healthy liquidity buffers
with the aggregate Liquidity Coverage Ratio at
157.4% (February-23: 152.7%).
• The aggregate loan-to-fund ratio remained stable at
81.9% (February-23: 81.6%).
PRESS RELEASE
Ref. No.: 04/23/05 EMBARGO: Not for publication or
broadcast before 1500 hours on
Friday, 28 April 2023
Monthly Highlights – March 2023
Headline inflation declined to 3.4% in March
• Headline inflation declined to 3.4% in March (February: 3.7%) due mainly
to lower inflation for fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation1 moderated slightly to 3.8% during the month
(February: 3.9%), driven largely by lower inflation for food away from
home.
Robust growth in volume index driven by retail and motor vehicles
• The Index of Wholesale and Retail Trade (IOWRT) expanded by 10.6%
in February 2023 (January: 8.5%).
• The higher growth was driven mainly by retail sales in non-specialised
stores (e.g., department stores) followed by continued strength in
purchases of motor vehicles amid the ongoing fulfilment of backlog
orders.
• On a month-on-month seasonally adjusted basis, the index accelerated
by 5.5% (January: 0.2%).
1 Core inflation is computed by excluding price-volatile and price-administered items.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Growth in credit to the private non-financial sector2,3 moderated
• Credit to the private non-financial sector grew by 4.2% as at end-March
(February: 4.5%), attributed to slower growth in credit to businesses
(3.2%; February: 3.7%).
• While growth in outstanding corporate bonds moderated (4.4%;
February: 5.5%), outstanding business loan growth was sustained at
2.4% (February: 2.4%). This was supported by the continued growth in
both working capital (2.2%; February: 1.9%) and investment-related
loans (4.3%; February: 4.2%).
• Outstanding household loan growth remained broadly stable (5.2%;
February: 5.3%), supported by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan growth for the purchase of
securities (-6.9%; February: -3.3%).
Domestic financial market conditions remained orderly
• In March, global financial markets were affected by the emergence of
banking sector stress in some major economies. As spillovers were
contained thus far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds improved.
• In line with the performance of regional currencies, the ringgit
appreciated by 1.7% against the US dollar. Conditions in the domestic
bond market also remained stable.
• The FBM KLCI declined by 2.2% during the month.
Banks maintained strong liquidity and funding positions to support
intermediation
• Banks continued to record healthy liquidity buffers with the aggregate
Liquidity Coverage Ratio at 157.4% (February: 152.7%).
2 Comprises loans to households and non-financial corporations from the banking system and development financial
institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers).
3 Starting with the publication of December 2022 Monthly Highlights and Statistics (MHS), this series was introduced
to enhance the quality of financing data. This new data series is available in the MHS Table 2.18.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
• The aggregate loan-to-fund ratio remained stable at 81.9%
(February: 81.6%).
Asset quality in the banking system remained intact
• Overall gross and net impaired loans ratios increased slightly to 1.8%
(February: 1.8%) and 1.2% (February: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory reserves) continues to
record a prudent level of 110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
Bank Negara Malaysia
28 April 2023
20230428_BNM Monthly Highlights-March_en
Slide 1
Slide 2
20230428_BNM PR_Monthly Highlights-Mar 2023_eng
| Press Release |
09 Mar 2023 | Monetary Policy Statement | https://www.bnm.gov.my/-/monetary-policy-statement-09032023 | https://www.bnm.gov.my/documents/20124/9964432/MPS_Snapshot_2023_03_en.pdf | null |
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Monetary Policy Statement
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574
Monetary Policy Statement
Embargo :
For immediate release
Not for publication or broadcast before
1500 on
Thursday, 9 March 2023
9 Mar 2023
At its meeting today, the Monetary Policy Committee (MPC) of Bank Negara Malaysia decided to maintain the Overnight Policy Rate (OPR) at 2.75 percent.
In the global economy, there were some positive developments with the reopening of China’s economy and better-than-expected growth outturns in major economies, supported by resilient domestic demand. Nevertheless, the global economy continues to be weighed down by elevated cost pressures and higher interest rates. Headline inflation moderated slightly from high levels in recent months, but core inflation remained above historical averages. Some central banks are expected to continue raising interest rates to manage inflationary pressures. This will continue to pose headwinds to the global growth outlook. The growth outlook remains subject to downside risks, mainly from an escalation of geopolitical tensions, higher-than-anticipated inflation outturns, and a sharp tightening in financial market conditions.
The Malaysian economy expanded strongly by 8.7% in 2022 driven by the recovery in private and public sector spending following the full reopening of the economy. After the strong performance in 2022, the economy is expected to moderate in 2023 amid a slower global economy. Growth will remain driven by domestic demand. Household spending will be underpinned by sustained improvements in employment and income prospects. Tourist arrivals are expected to continue rising, further lifting tourism-related activities. The continued progress of multi-year infrastructure projects will support investment activity. The implementation of projects from the recently re-tabled Budget 2023 would provide upside risks to the domestic growth outlook. Downside risks continue to stem mainly from global developments, including from weaker-than-expected growth outturns or much tighter and more volatile global financial conditions.
Headline and core inflation are expected to moderate over the course of 2023, but will continue to be elevated amid lingering demand and cost factors. The extent of upward pressures to inflation will remain partly contained by existing price controls and fuel subsidies, and the remaining spare capacity in the economy. The balance of risk to the inflation outlook is tilted to the upside and continues to be highly subject to any changes to domestic policy on subsidies and price controls, as well as global commodity price developments.
At the current OPR level, the stance of monetary policy remains accommodative and supportive of economic growth. The MPC will continue to assess the impact of the cumulative OPR adjustments, given the lag effects of monetary policy on the economy. The MPC remains vigilant to cost factors, including those arising from financial market developments, that could affect the inflation outlook. Further normalisation to the degree of monetary policy accommodation would be informed by the evolving conditions and their implications to the domestic inflation and growth outlook. The MPC will continue to calibrate the monetary policy settings that balance the risks to domestic inflation and sustainable growth.
See also:
Monetary Policy Statement (MPS) Snapshot: March 2023
Frequently Asked QuestionsBank Negara Malaysia
9 March 2023
© Bank Negara Malaysia, 2023. All rights reserved.
|
Monthly Highlights
February 2023
1
Higher export growth in February
Credit growth remained supportive of economic activity
Headline inflation was stable at 3.7% in February
• Exports grew by 9.8% (January: 1.4%) in February
2023.
• Manufactured export growth was driven mainly by
electrical and electronics (E&E) and petroleum
products. Meanwhile, commodities exports
continued to be supported mainly by liquefied
natural gas (LNG) and crude petroleum shipments.
• Moving forward, the moderation in global growth
and lower commodity prices are expected to weigh
on Malaysia’s exports.
Malaysia’s Exports by Product
RM billion %, yoy
5.9
1.4
9.8
0
10
20
30
40
50
60
0
50
100
150
Feb-22 Apr-22 Jun-22 Aug-22 Oct-22 Dec-22 Feb-23
Others Commodities
Non-resource based Resource-based
E&E Gross exports (%, yoy - RHS)
• Headline inflation was stable at 3.7% in February
(January: 3.7%) as the increase in inflation for food
and non-alcoholic beverages and rental was offset
by the decline in inflation for recreation services
and culture, as well as transport.
• Of note, adverse weather conditions in January and
February have also contributed to an increase in
inflation for certain segments of fresh food,
particularly fresh vegetables.
• Meanwhile, underlying inflation, as measured by
core inflation, was steady at 3.9% (January: 3.9%).
Contribution to Inflation
ppt. contribution
2.3
5.3
5.5
0
1
2
3
4
5
6
7
Feb-22 Jun-22 Oct-22 Feb-23
Business loans
Household loans
Corporate bonds
Annual growth (%)
Credit to the Private Non-Financial Sector1,2
Contribution to growth (ppt)
2.8 2.7 2.6 2.7
0.9 1.0 0.6 0.7
0.8 1.0
1.1 1.1
4.4 4.7
4.3 4.5
Nov-22 Dec-22 Jan-23 Feb-23
Corporate Bonds
Business Loans
Household Loans
Credit to the Private Non-
Financial Sector
• Credit to the private non-financial sector grew by
4.5% as at end-February (January: 4.3%), reflecting
mainly the higher growth in credit to businesses
(3.6%; January: 3.3%).
• Outstanding household loan growth was sustained
(5.3%; January: 5.3%), supported by higher growth
in consumption-related credit (4.8%; January: 4.4%),
while growth in outstanding loans for the purchase of
securities declined (-3.3%; January: -1.4%). Of note,
loan disbursement growth was strong across all
purposes (25.4%; January: 9.4%).
• For businesses, outstanding loan growth expanded
by 2.3% (January: 2.1%), driven by higher growth in
both working capital (1.9%; January: 1.6%) and
investment-related financing (4.1%; January: 3.9%).
Meanwhile, outstanding corporate bonds growth
continued to increase (5.5%; January: 5.1%).
3.7
3.7
3.9 3.9 -2.0
0.0
2.0
4.0
6.0
-2.0
0.0
2.0
4.0
6.0
J
a
n
-2
2
F
e
b
-2
2
M
a
r-
2
2
A
p
r-
2
2
M
a
y
-2
2
J
u
n
-2
2
J
u
l-
2
2
A
u
g
-2
2
S
e
p
-2
2
O
c
t-
2
2
N
o
v
-2
2
D
e
c
-2
2
J
a
n
-2
3
F
e
b
-2
3
Food & non-alcohol (29.5%) Housing & utilities (23.8%)
Transport (14.6%) Others (32.1%)
Headline inflation (RHS) Core inflation¹ (RHS)
Source: Department of Statistics, Malaysia (DOSM), MATRADE
1 Comprises loans to households and non-financial corporations from the
banking system and development financial institutions (DFIs), and corporate
bonds issued by non-financial corporations (including short-term papers).
2 Starting with the publication of December 2022 Monthly Highlights and
Statistics (MHS), this series was introduced to enhance the quality of financing
data. This new data series is available in the MHS Table 2.18.
Source: Bank Negara Malaysia
1 Core inflation is computed by excluding price-volatile and price-administered
items. It also excludes the estimated direct impact of tax policy changes.
Source: Department of Statistics Malaysia (DOSM), Bank Negara Malaysia
estimates
Monthly Highlights
Domestic financial conditions tightened following an upward revision to the US
policy rate expectations
2
Banks remain well-capitalised to support economic recovery
Banks maintained strong liquidity and funding positions to support intermediation
Financial Markets Performance in January 2023
Source: Bank Negara Malaysia, Bursa Malaysia
*Regional countries comprise Singapore, Thailand, Philippines, Indonesia
and Korea
• Global financial conditions tightened as market
participants revised upwards their expectations for
the future US federal funds rate following stronger-
than-expected US economic data.
• Consequently, domestic financial conditions
tightened. The 10-year Malaysian Government
Securities (MGS) yields rose by 11 bps, in tandem
with the movement of bond yields in regional*
(average: 26 bps) and major economies. The FBM
KLCI also declined by 2.1% (regional* average:
-2.0%) amid non-resident portfolio outflows from the
domestic equity market.
• The ringgit depreciated by 4.9% against the US
dollar, in line with the movement of regional*
currencies (average: -3.9%).
Banking System Capital Adequacy
Source: Bank Negara Malaysia
• Banks continue to record strong capital buffers to
absorb any unexpected shocks while preserving
their ability to provide financing to the economy.
• The banking system excess capital buffer1 stood at
RM135.0 billion.
1 Refers to total capital above the regulatory minimum, which includes the
capital conservation buffer (2.5%) and bank-specific higher minimum
requirements.
Source: Bank Negara Malaysia
%
14.8
15.3
18.5
8
10
12
14
16
18
20
F
e
b
-2
2
M
a
r-
2
2
A
p
r-
2
2
M
a
y
-2
2
J
u
n
-2
2
J
u
l-
2
2
A
u
g
-2
2
S
e
p
-2
2
O
c
t-
2
2
N
o
v
-2
2
D
e
c
-2
2
J
a
n
-2
3
F
e
b
-2
3
Common Equity Tier 1 (CET1) Capital Ratio
Tier 1 Capital Ratio
Total Capital Ratio
%
Banking System Asset Quality
81.5
152.7
0
40
80
120
160
70
75
80
85
90
95
F
e
b
2
2
M
a
r
2
2
A
p
r
2
2
M
a
y
2
2
J
u
n
2
2
J
u
l
2
2
A
u
g
2
2
S
e
p
2
2
O
c
t
2
2
N
o
v
2
2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
%
Liquidity Coverage Ratio (RHS)
Loan-to-Fund Ratio
-27
-0.7
3.2
11
-2.1
-4.9
10-year MGS
(bps, mom)
Equity
(%, mom)
Ringgit
(%, mom)
-35 -25 -15 -5 5 15
Feb-23 Jan-23
February 2023
• The banking system reported healthy liquidity
buffers with the aggregate Liquidity Coverage
Ratio at 152.7% (January: 147.1%).
• The aggregate loan-to-fund ratio remained largely
stable at 81.5% (January: 82.3%), supported by
sound growth in deposits of 7.0% (January: 7.5%).
PRESS RELEASE
Ref. No.: 03/23/08 EMBARGO: Not for publication or
broadcast before 1500 hours on
Friday, 31 March 2023
Monthly Highlights – February 2023
Headline inflation was stable at 3.7% in February
• Headline inflation was stable at 3.7% in February (January: 3.7%) as
the increase in inflation for food and non-alcoholic beverages and rental
was offset by the decline in inflation for recreation services and culture,
as well as transport.
• Of note, adverse weather conditions in January and February have also
contributed to an increase in inflation for certain segments of fresh food,
particularly fresh vegetables.
• Meanwhile, underlying inflation, as measured by core inflation1, was
steady at 3.9% (January: 3.9%).
Higher export growth in February
• Exports grew by 9.8% (January: 1.4%) in February 2023.
• Manufactured export growth was driven mainly by electrical and
electronics (E&E) and petroleum products. Meanwhile, commodities
exports continued to be supported mainly by liquefied natural gas (LNG)
and crude petroleum shipments.
• Moving forward, the moderation in global growth and lower commodity
prices are expected to weigh on Malaysia’s exports.
1 Core inflation is computed by excluding price-volatile and price-administered items. It also excludes the
estimated direct impact of tax policy changes.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Credit growth remained supportive of economic activity
• Credit to the private non-financial sector2,3 grew by 4.5% as at end-
February (January: 4.3%), reflecting mainly the higher growth in credit
to businesses (3.6%; January: 3.3%).
• Outstanding household loan growth was sustained (5.3%; January:
5.3%), supported by higher growth in consumption-related credit (4.8%;
January: 4.4%), while growth in outstanding loans for the purchase of
securities declined (-3.3%; January: -1.4%). Of note, loan disbursement
growth was strong across all purposes (25.4%; January: 9.4%).
• For businesses, outstanding loan growth expanded by 2.3% (January:
2.1%), driven by higher growth in both working capital (1.9%; January:
1.6%) and investment-related financing (4.1%; January: 3.9%).
Meanwhile, outstanding corporate bonds growth continued to increase
(5.5%; January: 5.1%).
Domestic financial conditions tightened following an upward revision to
the US policy rate expectations
• Global financial conditions tightened as market participants revised
upwards their expectations for the future US federal funds rate following
stronger-than-expected US economic data.
• Consequently, domestic financial conditions tightened. The 10-year
Malaysian Government Securities (MGS) yields rose by 11 bps, in
tandem with the movement of bond yields in regional* (average: 26 bps)
and major economies. The FBM KLCI also declined by 2.1% (regional*
average: -2.0%) amid non-resident portfolio outflows from the domestic
equity market.
• The ringgit depreciated by 4.9% against the US dollar, in line with the
movement of regional* currencies (average: -3.9%).
2 Comprises loans to households and non-financial corporations from the banking system and development
financial institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term
papers).
3 Starting with the publication of December 2022 Monthly Highlights and Statistics (MHS), this series was
introduced to enhance the quality of financing data. This new data series is available in the MHS Table 2.18.
*Regional countries comprise Singapore, Thailand, Philippines, Indonesia and Korea.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Banks remain well-capitalised to support economic recovery
• Banks continue to record strong capital buffers to absorb any
unexpected shocks while preserving their ability to provide financing to
the economy.
• The banking system excess capital buffer4 stood at RM135.0 billion.
Banks maintained strong liquidity and funding positions to support
intermediation
• The banking system reported healthy liquidity buffers with the
aggregate Liquidity Coverage Ratio at 152.7% (January: 147.1%).
• The aggregate loan-to-fund ratio remained largely stable at 81.5%
(January: 82.3%), supported by sound growth in deposits of 7.0%
(January: 7.5%).
Bank Negara Malaysia
31 March 2023
4 Refers to total capital above the regulatory minimum, which includes the capital conservation buffer (2.5%) and
bank-specific higher minimum requirements.
20230331_BNM Monthly Highlights Feb 2023_EN
Slide 1
Slide 2
PR
| Press Release |
07 Mar 2023 | International Reserves of Bank Negara Malaysia as at 28 February 2023 | https://www.bnm.gov.my/-/international-reserves-of-bank-negara-malaysia-as-at-28-february-2023 | https://www.bnm.gov.my/documents/20124/6118085/qb2021q4_en_box_imports.pdf | null |
Reading:
International Reserves of Bank Negara Malaysia as at 28 February 2023
Share:
3
International Reserves of Bank Negara Malaysia as at 28 February 2023
Embargo :
For immediate release
Not for publication or broadcast before
1500 on
Tuesday, 7 March 2023
7 Mar 2023
The international reserves of Bank Negara Malaysia amounted to USD114.3 billion as at 28 February 2023. The reserves position is sufficient to finance 5.0 months of imports of goods and services[1], and is 1.0 time of the total short-term external debt.
[1] Under the previous import coverage measure, reserves is sufficient to finance 6.2 months of retained imports of goods. For more information on the new indicator, please refer to the article on “Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to Imports of Goods and Services” in BNM’s Quarterly Bulletin for the Fourth Quarter of 2021 publication, page 27, which can be accessed at bnm.gov.my/-/quarterly-bulletin-4q-2021 Related Assets
BNM Statement of Assets & Liabilities - 28 February 2023
Bank Negara Malaysia
7 March 2023
© Bank Negara Malaysia, 2023. All rights reserved.
|
Monthly Highlights
Headline inflation declined to 3.4% in March
March 2023
1
3.7 3.4
3.9 3.8
0.00
2.00
4.00
0.0
2.0
4.0
J
a
n
-2
2
F
e
b
-2
2
M
a
r-
2
2
A
p
r-
2
2
M
a
y
-2
2
J
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-2
2
J
u
l-
2
2
A
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-2
2
S
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p
-2
2
O
c
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2
2
N
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-2
2
D
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-2
2
J
a
n
-2
3
F
e
b
-2
3
M
a
r-
2
3
Food & non-alcohol (29.5%) Housing & utilities (23.8%)
Transport (14.6%) Others (32.1%)
Headline inflation (RHS) Core inflation¹ (RHS)
Contribution to Inflation
ppt. contribution %, yoy
1 Core inflation is computed by excluding price-volatile and price-administered items.
Source: Department of Statistics, Malaysia & Bank Negara Malaysia estimates
• Headline inflation declined to 3.4% in March
(February: 3.7%) due mainly to lower inflation for
fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation moderated slightly to 3.8% during
the month (February: 3.9%), driven largely by
lower inflation for food away from home.
1
Robust growth in volume index driven by retail and motor vehicles
Index of Wholesale and Retail Trade
Source: Department of Statistics, Malaysia
• The Index of Wholesale and Retail Trade
(IOWRT) expanded by 10.6% in February 2023
(January: 8.5%).
• The higher growth was driven mainly by retail
sales in non-specialised stores (e.g., department
stores) followed by continued strength in
purchases of motor vehicles amid the ongoing
fulfilment of backlog orders.
• On a month-on-month seasonally adjusted basis,
the index accelerated by 5.5% (January: 0.2%).
9.5 8.510.6
0
10
20
30
40
Feb-
22
Mar-
22
Apr-
22
May-
22
Jun-
22
Jul-
22
Aug-
22
Sep-
22
Oct-
22
Nov-
22
Dec-
22
Jan-
23
Feb-
23
ppt, %yoy
Motor vehicles Retail Wholesale
2.4
5.2
4.4
0
1
2
3
4
5
6
7
Mar-22 Jul-22 Nov-22 Mar-23
Business loans
Household loans
Corporate bonds
Annual growth (%)
Growth in credit to the private non-financial sector moderated
1 Comprises loans to households and non-financial corporations from the
banking system and development financial institutions (DFIs), and corporate
bonds issued by non-financial corporations (including short-term papers).
2 Starting with the publication of December 2022 Monthly Highlights and
Statistics (MHS), this series was introduced to enhance the quality of
financing data. This new data series is available in the MHS Table 2.18.
Source: Bank Negara Malaysia
2.7 2.6 2.7 2.6
1.0 0.6 0.7 0.7
1.0
1.1 1.1 0.9
4.7 4.3 4.5 4.2
Dec-22 Jan-23 Feb-23 Mar-23
Corporate Bonds
Business Loans
Household Loans
Credit to the Private Non-
Financial Sector
Contribution to growth (ppt)
• Credit to the private non-financial sector grew by
4.2% as at end-March (February: 4.5%), attributed
to slower growth in credit to businesses (3.2%;
February: 3.7%).
• While growth in outstanding corporate bonds
moderated (4.4%; February : 5.5%), outstanding
business loan growth was sustained at 2.4%
(February: 2.4%). This was supported by the
continued growth in both working capital (2.2%;
February: 1.9%) and investment-related loans
(4.3%; February: 4.2%).
• Outstanding household loan growth remained
broadly stable (5.2%; February: 5.3%), supported
by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan
growth for the purchase of securities (-6.9%;
February: -3.3%).
Credit to the Private Non-Financial Sector1,2
Monthly Highlights
March 2023
Domestic financial market conditions remained orderly
Financial Market Performance in March 2023
Source: Bank Negara Malaysia, Bursa Malaysia
Note: The exchange rate data is the noon-rate in the Kuala Lumpur Interbank Foreign Exchange Market
11.0
-2.1
-5.3
0.0
-2.2
1.7
10-year MGS
(bps, mom)
Equity
(%, mom)
Ringgit
(%, mom)
-10 -5 0 5 10 15
Mar-23
Feb-23
• In March, global financial markets were affected by
the emergence of banking sector stress in some
major economies. As spillovers were contained thus
far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds
improved.
• In line with the performance of regional currencies,
the ringgit appreciated by 1.7% against the US
dollar. Conditions in the domestic bond market
also remained stable.
• The FBM KLCI declined by 2.2% during the month.
2
Banks maintained strong liquidity and funding positions to support intermediation
Source: Bank Negara Malaysia
Banking System Liquidity and Funding Ratios
81.9
157.4
0
40
80
120
160
70
75
80
85
90
95
M
a
r
2
2
A
p
r
2
2
M
a
y
2
2
J
u
n
2
2
J
u
l
2
2
A
u
g
2
2
S
e
p
2
2
O
c
t
2
2
N
o
v
2
2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
% %
Liquidity Coverage Ratio (RHS)
Loan-to-Fund Ratio
Asset quality in the banking system remained intact
Banking System Asset Quality
Source: Bank Negara Malaysia
• Overall gross and net impaired loans ratios
increased slightly to 1.8% (February-23: 1.8%) and
1.2% (February-23: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory
reserves) continue to record a prudent level of
110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
%
1.8
1.2
1.7
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
M
a
r
2
2
A
p
r
2
2
M
a
y
2
2
J
u
n
2
2
J
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2
2
A
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2
2
S
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p
2
2
O
c
t
2
2
N
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2
2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
Gross Impaired Loans Ratio
Total Provisions to Total Loans Ratio
Net Impaired Loans Ratio
• Banks continued to record healthy liquidity buffers
with the aggregate Liquidity Coverage Ratio at
157.4% (February-23: 152.7%).
• The aggregate loan-to-fund ratio remained stable at
81.9% (February-23: 81.6%).
PRESS RELEASE
Ref. No.: 04/23/05 EMBARGO: Not for publication or
broadcast before 1500 hours on
Friday, 28 April 2023
Monthly Highlights – March 2023
Headline inflation declined to 3.4% in March
• Headline inflation declined to 3.4% in March (February: 3.7%) due mainly
to lower inflation for fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation1 moderated slightly to 3.8% during the month
(February: 3.9%), driven largely by lower inflation for food away from
home.
Robust growth in volume index driven by retail and motor vehicles
• The Index of Wholesale and Retail Trade (IOWRT) expanded by 10.6%
in February 2023 (January: 8.5%).
• The higher growth was driven mainly by retail sales in non-specialised
stores (e.g., department stores) followed by continued strength in
purchases of motor vehicles amid the ongoing fulfilment of backlog
orders.
• On a month-on-month seasonally adjusted basis, the index accelerated
by 5.5% (January: 0.2%).
1 Core inflation is computed by excluding price-volatile and price-administered items.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Growth in credit to the private non-financial sector2,3 moderated
• Credit to the private non-financial sector grew by 4.2% as at end-March
(February: 4.5%), attributed to slower growth in credit to businesses
(3.2%; February: 3.7%).
• While growth in outstanding corporate bonds moderated (4.4%;
February: 5.5%), outstanding business loan growth was sustained at
2.4% (February: 2.4%). This was supported by the continued growth in
both working capital (2.2%; February: 1.9%) and investment-related
loans (4.3%; February: 4.2%).
• Outstanding household loan growth remained broadly stable (5.2%;
February: 5.3%), supported by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan growth for the purchase of
securities (-6.9%; February: -3.3%).
Domestic financial market conditions remained orderly
• In March, global financial markets were affected by the emergence of
banking sector stress in some major economies. As spillovers were
contained thus far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds improved.
• In line with the performance of regional currencies, the ringgit
appreciated by 1.7% against the US dollar. Conditions in the domestic
bond market also remained stable.
• The FBM KLCI declined by 2.2% during the month.
Banks maintained strong liquidity and funding positions to support
intermediation
• Banks continued to record healthy liquidity buffers with the aggregate
Liquidity Coverage Ratio at 157.4% (February: 152.7%).
2 Comprises loans to households and non-financial corporations from the banking system and development financial
institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers).
3 Starting with the publication of December 2022 Monthly Highlights and Statistics (MHS), this series was introduced
to enhance the quality of financing data. This new data series is available in the MHS Table 2.18.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
• The aggregate loan-to-fund ratio remained stable at 81.9%
(February: 81.6%).
Asset quality in the banking system remained intact
• Overall gross and net impaired loans ratios increased slightly to 1.8%
(February: 1.8%) and 1.2% (February: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory reserves) continues to
record a prudent level of 110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
Bank Negara Malaysia
28 April 2023
20230428_BNM Monthly Highlights-March_en
Slide 1
Slide 2
20230428_BNM PR_Monthly Highlights-Mar 2023_eng
| Press Release |
28 Feb 2023 | Monetary and Financial Developments in January 2023 | https://www.bnm.gov.my/-/monetary-and-financial-developments-in-january-2023 | https://www.bnm.gov.my/documents/20124/9907139/i_en.pdf | null |
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Monetary and Financial Developments in January 2023
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Monetary and Financial Developments in January 2023
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28 Feb 2023
Headline inflation moderated to 3.7% in January
Headline inflation moderated to 3.7% in January (December 2022: 3.8%) due mainly to lower core inflation.
Core inflation[1] declined to 3.9% during the month (December 2022: 4.1%). The lower core inflation largely reflected lower inflation in several core services categories, such as telephone and telefax services, repair and maintenance for personal transport, and food away from home.
Robust growth in all export categories
The Index of Wholesale and Retail Trade (IOWRT) expanded by 9.5% in December 2022 (November 2022: 9.8%). Growth was supported by higher sales of discretionary goods such as clothing, footwear, jewellery and cosmetic goods as well as necessities in physical stores, such as supermarkets, compared to December 2021, when the economy just reopened.
On a seasonally adjusted m-o-m basis, the index continued to expand marginally by 0.2% (November 2022: 1.2%).
Growth in credit to the private non-financial sector[2],[3] moderated in January
Outstanding credit to the private non-financial sector grew by 4.3% as at end-January 2023 (December 2022: 4.7%), amid slower growth in credit to both businesses (3.3%; December 2022: 3.9%) and households (5.2%; December 2022: 5.5%).
The growth in outstanding business loans moderated to 2.0%
(December 2022: 3.4%), due mainly to slower growth in working capital financing (1.5%; December 2022: 4.2%). Meanwhile, outstanding corporate bonds continued to grow at a faster pace (5.1%; December 2022: 4.6%).
For households, outstanding loan growth moderated slightly as the growth in loan repayments (21.4%) continued to outpace that of loan disbursements (9.2%).
Domestic financial conditions eased following expectations of a slowdown in US monetary policy tightening and positive investor risk sentiment
Global financial conditions eased amid continued expectations for smaller interest rate increases by the US Federal Reserve moving forward, as inflation showed tentative signs of slowing down. Additionally, China’s reopening and its expected positive spillovers to the global economy improved investors’ risk sentiment.
Consequently, domestic financial conditions eased, with the 10-year MGS yields declining by 27.0 bps (regional[4] average: -37.5 bps). However, the FBM KLCI decreased marginally by 0.7% (regional[4] average: +4.2%) driven mainly by the plantation and healthcare sectors.
The ringgit appreciated by 3.2% against the US dollar, in line with a broad-based appreciation in major and regional[4] (average: +3.3%) currencies against the US dollar.
Banks remain well-capitalised to support economic recovery
Banks’ capital position remains strong to support credit flows to the economy, with excess capital buffers[5] of RM141.5 billion.
Capital ratios rose marginally in January, driven by increases in retained earnings and new issuances of capital instruments.
The resilience of banks continues to be underpinned by sound asset quality
Overall gross and net impaired loans ratios remain largely unchanged at 1.7% and 1.1%, respectively.
Loan loss coverage ratio (including regulatory reserves) remains at a prudent level of 117.1% of impaired loans, with total provisions accounting for 1.7% of total loans.
See also: Monthly Highlights [PDF]
[1] Core inflation is computed by excluding price-volatile and price-administered items. It also excludes the estimated direct impact of tax policy changes.
[2] Comprises loans to households and non-financial corporations from the banking system and development financial institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers).
[3] Starting with the publication of December 2022 Monthly Highlights and Statistics (MHS), this series was introduced to enhance the quality of financing data. This new data series is available in the MHS Table 2.18.
[4] Regional countries comprise Singapore, Thailand, Philippines, Indonesia and Korea.
[5] Refers to total capital above the regulatory minimum, which includes the capital conservation buffer (2.5%) and bank-specific higher minimum requirements.
Related Assets
Monthly Highlights & Statistics in January 2023
Bank Negara Malaysia
28 February 2023
© Bank Negara Malaysia, 2023. All rights reserved.
|
Monthly Highlights May 2023
Monthly Highlights
Headline inflation declined further to 2.8% in May
May 2023
Contribution to Inflation
ppt. contribution %, yoy
1 Core inflation is computed by excluding price-volatile and price-administered items.
Source: Department of Statistics, Malaysia & Bank Negara Malaysia estimates
• Headline inflation moderated to 2.8% (April 2023:
3.3%). This decline was largely due to non-core
CPI components, particularly lower inflation for
fuel (-0.2 percentage points, ppt) and fresh food
(-0.1ppt).
• Core inflation also declined slightly to 3.5% (April
2023: 3.6%) amid lower inflation for
communication services.
3.3
2.8
3.6 3.5
0.00
2.00
4.00
0.0
2.0
4.0
J
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-2
2
F
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-2
2
M
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2
2
A
p
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2
2
M
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-2
2
J
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-2
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J
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2
2
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-2
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-2
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-2
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-2
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-2
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2
3
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2
3
M
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-2
3
Food & non-alcohol (29.5%) Housing & utilities (23.8%)
Transport (14.6%) Others (32.1%)
Headline inflation (RHS) Core inflation¹ (RHS)
1.6
5.1
4.6
0
1
2
3
4
5
6
7
May-22 Sep-22 Jan-23 May-23
Business loans
Household loans
Corporate bonds
Annual growth (%)
Credit to the Private Non-Financial Sector1,2
1
Growth in credit to the private non-financial sector improved in May
1 Comprises loans to households and non-financial corporations from the
banking system and development financial institutions (DFIs), and corporate
bonds issued by non-financial corporations (including short-term papers).
2 Starting with the publication of December 2022 Monthly Highlights and
Statistics (MHS), this series was introduced to enhance the quality of
financing data. This new data series is available in the MHS Table 2.18.
Source: Bank Negara Malaysia
Contribution to growth (ppt)
• Credit to the private non-financial sector expanded
by 4.0% as at end-May (April 2023: 3.7%), driven
mainly by higher growth in credit to businesses
(2.8%; April 2023: 2.5%).
• Outstanding corporate bonds grew by 4.6% (April
2023: 4.4%), while outstanding business loans
expanded by 1.6% (April 2023: 1.0%). The higher
business loan growth reflected improvement in
loans for both working capital and investments to
SMEs and non-SMEs.
• In the household segment, outstanding loan
growth was sustained at 5.1% (April 2023: 5.0%),
supported by higher growth across most loan
purposes. Of note, household loan growth
continued to be driven by loans for the purchase of
houses and cars, which grew by 7.0% and 8.4%,
respectively (April 2023: 6.8% and 8.0%).
2.7 2.6 2.5 2.6
0.7 0.7 0.3 0.5
1.1 0.9
0.9 1.0
4.5 4.2
3.7 4.0
Feb-23 Mar-23 Apr-23 May-23
Corporate Bonds
Business Loans
Household Loans
Credit to the Private Non-
Financial Sector
Index of wholesale and retail trade growth moderated in April
Source: Department of Statistics, Malaysia
• The Index of Wholesale and Retail Trade
(IOWRT) expanded more moderately by 4.7% in
April 2023 (March 2023: 9.4%). The lower growth
was due mainly to the decline in the motor vehicle
segment.
• However, the retail segment continued to record a
double-digit growth of 10.0% (March 2023:
13.8%), supported by sales in non-specialised and
other specialised stores1.
• On a month-on-month seasonally adjusted basis,
the index increased at a faster pace of 6.5%
(March 2023: -0.9%).
1 Other goods in specialised stores includes clothing, footwear,
pharmaceuticals, cosmetics, watches, jewellery and optical goods.
10.6
9.4
4.7
-2
3
8
13
18
23
28
33
Apr-22 Jun-22 Aug-22 Oct-22 Dec-22 Feb-23 Apr-23
ppt, %yoy
Motor vehicles Retail Wholesale
Index of Wholesale and Retail Trade
Monthly Highlights
2
May 2023
Domestic financial markets were largely affected by external factors
Financial Market Performance in May 2023
-18.0
-0.5
-1.1
-3.0
-2.0
-3.4
10-year MGS
(bps, mom)
Equity
(%, mom)
Ringgit
(%, mom)
-20 -15 -10 -5 0
May-23 Apr-23
Note: The exchange rate data is the noon-rate in the Kuala Lumpur Interbank Foreign Exchange Market
1Regional countries comprise Singapore, Thailand, Philippines, Indonesia, and Korea
Source: Bank Negara Malaysia, Bursa Malaysia
• Global investors maintained a risk-off approach
throughout May, as concerns over the impact of the
US debt ceiling crisis and the weaker-than-
expected rebound in China’s economy weighed on
global financial markets.
• As a result, the ringgit depreciated against the US
dollar by 3.4% (regional1 average: -1.2%). Similarly,
the FBM KLCI declined by 2.0% (regional1 average:
-1.3%).
• Nonetheless, the 10-year MGS yields decreased
slightly by 3 basis points, supported by non-resident
inflows into the domestic bond market.
Banks maintained strong liquidity and funding positions to support intermediation
• Banks continued to record healthy liquidity buffers
with the aggregate Liquidity Coverage Ratio at
151.2% (April 2023: 154.3%).
• The aggregate loan-to-fund ratio remained stable at
81.8% (April 2023: 82.1%).
Source: Bank Negara Malaysia
Banking System Liquidity and Funding Ratios
81.8
151.2
0
40
80
120
160
70
75
80
85
90
95
M
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2
2
J
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2
J
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2
O
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2
2
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D
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2
3
F
e
b
2
3
M
a
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2
3
A
p
r
2
3
M
a
y
2
3
% %
Liquidity Coverage Ratio (RHS)
Loan-to-Fund Ratio
Asset quality in the banking system remained intact
Banking System Asset Quality
Source: Bank Negara Malaysia
• Overall gross and net impaired loans ratios
remained broadly unchanged at 1.80% (April
2023: 1.78%) and 1.10% (April 2023: 1.10%),
respectively.
• Loan loss coverage ratio (including regulatory
reserves) remained at a prudent level of 114.1%
of impaired loans, with total provisions accounting
for 1.7% of total loans.
%
1.8
1.1
1.7
0.5
1.0
1.5
2.0
M
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J
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A
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2
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M
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2
3
Gross Impaired Loans Ratio
Total Provisions to Total Loans Ratio
Net Impaired Loans Ratio
April 2023 Monthly Highlights
Slide 1
Slide 2
| Press Release |
28 Feb 2023 | Detailed Disclosure of International Reserves as at end-January 2023 | https://www.bnm.gov.my/-/detailed-disclosure-of-international-reserves-as-at-end-january-2023-1 | null | null |
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Detailed Disclosure of International Reserves as at end-January 2023
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4
Detailed Disclosure of International Reserves as at end-January 2023
Embargo :
For immediate release
Not for publication or broadcast before
1200 on
Tuesday, 28 February 2023
28 Feb 2023
In accordance with the IMF SDDS format, the detailed breakdown of international reserves provides forward-looking information on the size, composition and usability of reserves and other foreign currency assets, and the expected and potential future inflows and outflows of foreign exchange of the Federal Government and Bank Negara Malaysia over the next 12-month period.
The detailed breakdown of international reserves based on the SDDS format is shown in Tables I, II, III and IV.
As shown in Table I, official reserve assets amounted to USD115,164.1 million, while other foreign currency assets amounted to USD4.7 million as at end-January 2023.
As shown in Table II, for the next 12 months, the pre-determined short-term outflows of foreign currency loans, securities and deposits, which include among others, scheduled repayment of external borrowings by the Government and the maturity of foreign currency Bank Negara Interbank Bills, amounted to USD16,298.1 million. The short forward positions amounted to USD26,543.9 million as at end-January 2023, reflecting the management of ringgit liquidity in the money market. In line with the practice adopted since April 2006, the data excludes projected foreign currency inflows arising from interest income and the drawdown of project loans. Projected foreign currency inflows amount to USD2,277.5 million in the next 12 months.
As shown in Table III, the only contingent short-term net drain on foreign currency assets are Government guarantees of foreign currency debt due within one year, amounting to USD371.1 million. There are no foreign currency loans with embedded options, no undrawn, unconditional credit lines provided by or to other central banks, international organisations, banks and other financial institutions. Bank Negara Malaysia also does not engage in foreign currency options vis-à-vis ringgit.
Overall, the detailed breakdown of international reserves under the IMF SDDS format indicates that as at end-January 2023, Malaysia’s international reserves remain usable. Related Assets
International Reserves and Foreign Currency Liquidity (31 January 2023)
Bank Negara Malaysia
28 February 2023
© Bank Negara Malaysia, 2023. All rights reserved.
| null | Press Release |
22 Feb 2023 | International Reserves of Bank Negara Malaysia as at 15 February 2023 | https://www.bnm.gov.my/-/international-reserves-of-bank-negara-malaysia-as-at-15-february-2023 | https://www.bnm.gov.my/documents/20124/6118085/qb2021q4_en_box_imports.pdf | null |
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International Reserves of Bank Negara Malaysia as at 15 February 2023
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3
International Reserves of Bank Negara Malaysia as at 15 February 2023
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22 Feb 2023
The international reserves of Bank Negara Malaysia amounted to USD114.4 billion as at 15 February 2023. The reserves position is sufficient to finance 5.0 months of imports of goods and services[1], and is 1.0 time of the total short-term external debt.
[1] Under the previous import coverage measure, reserves is sufficient to finance 6.2 months of retained imports of goods. For more information on the new indicator, please refer to the article on “Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to Imports of Goods and Services” in BNM’s Quarterly Bulletin for the Fourth Quarter of 2021 publication, page 27, which can be accessed at bnm.gov.my/-/quarterly-bulletin-4q-2021 Related Assets
BNM Statement of Assets & Liabilities - 15 February 2023
Bank Negara Malaysia
22 February 2023
© Bank Negara Malaysia, 2023. All rights reserved.
|
Monthly Highlights
Headline inflation declined to 3.4% in March
March 2023
1
3.7 3.4
3.9 3.8
0.00
2.00
4.00
0.0
2.0
4.0
J
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2
F
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F
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-2
3
M
a
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2
3
Food & non-alcohol (29.5%) Housing & utilities (23.8%)
Transport (14.6%) Others (32.1%)
Headline inflation (RHS) Core inflation¹ (RHS)
Contribution to Inflation
ppt. contribution %, yoy
1 Core inflation is computed by excluding price-volatile and price-administered items.
Source: Department of Statistics, Malaysia & Bank Negara Malaysia estimates
• Headline inflation declined to 3.4% in March
(February: 3.7%) due mainly to lower inflation for
fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation moderated slightly to 3.8% during
the month (February: 3.9%), driven largely by
lower inflation for food away from home.
1
Robust growth in volume index driven by retail and motor vehicles
Index of Wholesale and Retail Trade
Source: Department of Statistics, Malaysia
• The Index of Wholesale and Retail Trade
(IOWRT) expanded by 10.6% in February 2023
(January: 8.5%).
• The higher growth was driven mainly by retail
sales in non-specialised stores (e.g., department
stores) followed by continued strength in
purchases of motor vehicles amid the ongoing
fulfilment of backlog orders.
• On a month-on-month seasonally adjusted basis,
the index accelerated by 5.5% (January: 0.2%).
9.5 8.510.6
0
10
20
30
40
Feb-
22
Mar-
22
Apr-
22
May-
22
Jun-
22
Jul-
22
Aug-
22
Sep-
22
Oct-
22
Nov-
22
Dec-
22
Jan-
23
Feb-
23
ppt, %yoy
Motor vehicles Retail Wholesale
2.4
5.2
4.4
0
1
2
3
4
5
6
7
Mar-22 Jul-22 Nov-22 Mar-23
Business loans
Household loans
Corporate bonds
Annual growth (%)
Growth in credit to the private non-financial sector moderated
1 Comprises loans to households and non-financial corporations from the
banking system and development financial institutions (DFIs), and corporate
bonds issued by non-financial corporations (including short-term papers).
2 Starting with the publication of December 2022 Monthly Highlights and
Statistics (MHS), this series was introduced to enhance the quality of
financing data. This new data series is available in the MHS Table 2.18.
Source: Bank Negara Malaysia
2.7 2.6 2.7 2.6
1.0 0.6 0.7 0.7
1.0
1.1 1.1 0.9
4.7 4.3 4.5 4.2
Dec-22 Jan-23 Feb-23 Mar-23
Corporate Bonds
Business Loans
Household Loans
Credit to the Private Non-
Financial Sector
Contribution to growth (ppt)
• Credit to the private non-financial sector grew by
4.2% as at end-March (February: 4.5%), attributed
to slower growth in credit to businesses (3.2%;
February: 3.7%).
• While growth in outstanding corporate bonds
moderated (4.4%; February : 5.5%), outstanding
business loan growth was sustained at 2.4%
(February: 2.4%). This was supported by the
continued growth in both working capital (2.2%;
February: 1.9%) and investment-related loans
(4.3%; February: 4.2%).
• Outstanding household loan growth remained
broadly stable (5.2%; February: 5.3%), supported
by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan
growth for the purchase of securities (-6.9%;
February: -3.3%).
Credit to the Private Non-Financial Sector1,2
Monthly Highlights
March 2023
Domestic financial market conditions remained orderly
Financial Market Performance in March 2023
Source: Bank Negara Malaysia, Bursa Malaysia
Note: The exchange rate data is the noon-rate in the Kuala Lumpur Interbank Foreign Exchange Market
11.0
-2.1
-5.3
0.0
-2.2
1.7
10-year MGS
(bps, mom)
Equity
(%, mom)
Ringgit
(%, mom)
-10 -5 0 5 10 15
Mar-23
Feb-23
• In March, global financial markets were affected by
the emergence of banking sector stress in some
major economies. As spillovers were contained thus
far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds
improved.
• In line with the performance of regional currencies,
the ringgit appreciated by 1.7% against the US
dollar. Conditions in the domestic bond market
also remained stable.
• The FBM KLCI declined by 2.2% during the month.
2
Banks maintained strong liquidity and funding positions to support intermediation
Source: Bank Negara Malaysia
Banking System Liquidity and Funding Ratios
81.9
157.4
0
40
80
120
160
70
75
80
85
90
95
M
a
r
2
2
A
p
r
2
2
M
a
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2
2
J
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2
2
J
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2
2
A
u
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2
2
S
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p
2
2
O
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2
2
N
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2
2
D
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2
2
J
a
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2
3
F
e
b
2
3
M
a
r
2
3
% %
Liquidity Coverage Ratio (RHS)
Loan-to-Fund Ratio
Asset quality in the banking system remained intact
Banking System Asset Quality
Source: Bank Negara Malaysia
• Overall gross and net impaired loans ratios
increased slightly to 1.8% (February-23: 1.8%) and
1.2% (February-23: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory
reserves) continue to record a prudent level of
110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
%
1.8
1.2
1.7
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
M
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2
2
A
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2
M
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2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
Gross Impaired Loans Ratio
Total Provisions to Total Loans Ratio
Net Impaired Loans Ratio
• Banks continued to record healthy liquidity buffers
with the aggregate Liquidity Coverage Ratio at
157.4% (February-23: 152.7%).
• The aggregate loan-to-fund ratio remained stable at
81.9% (February-23: 81.6%).
PRESS RELEASE
Ref. No.: 04/23/05 EMBARGO: Not for publication or
broadcast before 1500 hours on
Friday, 28 April 2023
Monthly Highlights – March 2023
Headline inflation declined to 3.4% in March
• Headline inflation declined to 3.4% in March (February: 3.7%) due mainly
to lower inflation for fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation1 moderated slightly to 3.8% during the month
(February: 3.9%), driven largely by lower inflation for food away from
home.
Robust growth in volume index driven by retail and motor vehicles
• The Index of Wholesale and Retail Trade (IOWRT) expanded by 10.6%
in February 2023 (January: 8.5%).
• The higher growth was driven mainly by retail sales in non-specialised
stores (e.g., department stores) followed by continued strength in
purchases of motor vehicles amid the ongoing fulfilment of backlog
orders.
• On a month-on-month seasonally adjusted basis, the index accelerated
by 5.5% (January: 0.2%).
1 Core inflation is computed by excluding price-volatile and price-administered items.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Growth in credit to the private non-financial sector2,3 moderated
• Credit to the private non-financial sector grew by 4.2% as at end-March
(February: 4.5%), attributed to slower growth in credit to businesses
(3.2%; February: 3.7%).
• While growth in outstanding corporate bonds moderated (4.4%;
February: 5.5%), outstanding business loan growth was sustained at
2.4% (February: 2.4%). This was supported by the continued growth in
both working capital (2.2%; February: 1.9%) and investment-related
loans (4.3%; February: 4.2%).
• Outstanding household loan growth remained broadly stable (5.2%;
February: 5.3%), supported by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan growth for the purchase of
securities (-6.9%; February: -3.3%).
Domestic financial market conditions remained orderly
• In March, global financial markets were affected by the emergence of
banking sector stress in some major economies. As spillovers were
contained thus far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds improved.
• In line with the performance of regional currencies, the ringgit
appreciated by 1.7% against the US dollar. Conditions in the domestic
bond market also remained stable.
• The FBM KLCI declined by 2.2% during the month.
Banks maintained strong liquidity and funding positions to support
intermediation
• Banks continued to record healthy liquidity buffers with the aggregate
Liquidity Coverage Ratio at 157.4% (February: 152.7%).
2 Comprises loans to households and non-financial corporations from the banking system and development financial
institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers).
3 Starting with the publication of December 2022 Monthly Highlights and Statistics (MHS), this series was introduced
to enhance the quality of financing data. This new data series is available in the MHS Table 2.18.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
• The aggregate loan-to-fund ratio remained stable at 81.9%
(February: 81.6%).
Asset quality in the banking system remained intact
• Overall gross and net impaired loans ratios increased slightly to 1.8%
(February: 1.8%) and 1.2% (February: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory reserves) continues to
record a prudent level of 110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
Bank Negara Malaysia
28 April 2023
20230428_BNM Monthly Highlights-March_en
Slide 1
Slide 2
20230428_BNM PR_Monthly Highlights-Mar 2023_eng
| Press Release |
10 Feb 2023 | Economic and Financial Developments in Malaysia in the Fourth Quarter of 2022 | https://www.bnm.gov.my/-/qb22q4_en_pr | https://www.bnm.gov.my/documents/20124/9722771/qb22q4_transcript.pdf, https://www.bnm.gov.my/documents/20124/9722771/qb22q4_slides.pdf, https://www.bnm.gov.my/documents/20124/9722771/qb22q4_en_table1.pdf | null |
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Economic and Financial Developments in Malaysia in the Fourth Quarter of 2022
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Economic and Financial Developments in Malaysia in the Fourth Quarter of 2022
Embargo :
For immediate release
Not for publication or broadcast before
1200 on
Friday, 10 February 2023
10 Feb 2023
The economy expanded by 7.0% in the fourth quarter (3Q 2022: 14.2%)
The Malaysian economy grew slower in the fourth quarter of 2022 (7.0%; 3Q 2022: 14.2%) as support from the stimulus measures and low base effect[1] waned. At 7.0%, the growth was still above the long-term average of 5.1%[2]. Private sector activity remained the key driver of growth, supported by private consumption and investment. The continued growth in private consumption was mainly driven by improving labour market conditions. Meanwhile, overall export growth moderated in line with the weaker external demand. This was partly offset by the resilient performance in exports of electrical and electronic (E&E) products and higher tourism activities. The services and manufacturing sectors continued to drive growth. On a quarter-on-quarter seasonally-adjusted basis, the economy registered a decline of 2.6% (3Q 2022: +1.9%). Overall, the Malaysian economy expanded by 8.7% in 2022.
Headline inflation moderated to 3.9% during the fourth quarter (3Q 2022: 4.5%). The moderation was mainly due to the lapse in the base effect on electricity inflation, a key contributor to the higher inflation in the third quarter of 2021. The moderating trend in key global commodity prices partly led to lower inflation in some Consumer Price Index (CPI) items, including fuel. Inflation for some key staple food items, such as fresh meat and eggs, also moderated during the quarter. However, the downward impact of these factors was partly offset by higher core inflation. Core inflation increased to 4.2% (3Q 2022: 3.7%), driven by the continued strength in demand amid a still-elevated cost environment. For 2022 as a whole, headline inflation increased to 3.3% (2021: 2.5%) and core inflation averaged higher at 3.0% (2021: 0.7%).
Exchange rate developments
Domestic financial conditions have eased mostly due to global developments during the quarter. In particular, market expectations for smaller interest rate increases by the US Federal Reserve amid indications of slowing inflation in the US have eased the strength of the US dollar. Global investor sentiments on the ringgit and regional currencies have also been somewhat lifted by the reopening of China’s economy and its expected positive economic spillovers to the region.
These encouraging global developments and greater domestic political certainty after the formation of the new Government in November 2022 led to a stronger ringgit against the US dollar. In line with other regional currencies, the ringgit ended the quarter stronger by 5.3% against the US dollar. Similarly, the ringgit also strengthened against several major trading partners – the nominal effective exchange rate (NEER) appreciated by 0.4% during the quarter. Moving forward, BNM will continue to closely monitor global and domestic financial conditions, and ensure orderly financial market adjustments.
Financing conditions
Credit to the private non-financial sector grew by 4.7% (3Q 2022: 5.3%) amid the lower outstanding loan growth (4.7%; 3Q 2022: 5.7%). Meanwhile, outstanding corporate bonds continued to grow by 4.6% (3Q 2022: 4.0%). Outstanding business loans grew by 3.3%, as the sustained strong growth in loan repayments outpaced that of loan disbursements. Despite the slower growth in loan applications, loan disbursement growth was sustained (12.0%; 3Q 2022: 18.0%), particularly for working capital loans as firms continued to draw down on their existing credit facilities. For households, outstanding loan growth expanded by 5.5% amid the slower growth in loan disbursements (10.3%; 3Q 2022: 48.1%) and sustained growth in loan repayments.
Domestic demand will be key to Malaysia’s growth performance in 2023
For 2023, the Malaysian economy is expected to expand at a more moderate pace amid a challenging external environment. Domestic demand will continue to drive growth, supported by the continued recovery in the labour market and the realisation of multi-year investment projects. The services and manufacturing sectors will also continue to support growth. Meanwhile, the slowdown in exports following weaker global demand would be partially cushioned by higher tourism activity. The balance of risks remains tilted to the downside, mainly from weaker global growth, tighter financial conditions, re-escalation of geopolitical conflicts and worsening supply chain disruptions.
Headline inflation to moderate but remain at elevated levels in 2023
Headline and core inflation are expected to moderate but remain elevated in 2023 amid lingering cost and demand pressures. Core inflation is expected to remain elevated in the near term, in part due to the low base in the first half of 2022. Existing price controls and fuel subsidies, and the remaining spare capacity in the economy, will continue to partly contain the extent of upward pressures to inflation. The inflation outlook remains highly subject to any changes to domestic policy, as well as global commodity price developments.
Bank Negara Malaysia will publish its Annual Report 2022, the Economic and Monetary Review 2022, and the Financial Stability Review for the Second Half of 2022 on 29 March 2023.
[1] The low base effect originated from the decline in economic growth in the third quarter of 2021 (-4.5%), partially contributing towards a high growth of 14.2 % a year later, in the third quarter of 2022.
[2] Average from 1Q 2011 to 4Q 2019.
See also:
Press Conference Slides (PDF)
Press Conference Presentation Transcript
Press Conference Video
Publication: Quarterly Bulletin Fourth Quarter 2022
Table 1: GDP by Expenditure Components and Economic Activity
Bank Negara Malaysia
10 February 2023
© Bank Negara Malaysia, 2023. All rights reserved.
|
GDP Q4 2022 Presentation Transcript
PRESS RELEASE
EMBARGO: For immediate release
ECONOMIC AND FINANCIAL DEVELOPMENTS IN MALAYSIA
IN THE FOURTH QUARTER OF 2022
Press Conference Presentation Transcript
The global economy moderated further in 4Q 2022
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “In the
fourth quarter of 2022, global growth continued to moderate, amid higher
interest rates and slower trade activity.
“In addition, China also experienced a severe COVID-19 resurgence which
affected its economic activity.
“Meanwhile, global inflation started to moderate amid softer commodity prices
and easing supply chains disruptions. However, it remained significantly above
average.”
Malaysia’s GDP grew by 7.0% in 4Q 2022, bringing full year growth to 8.7%
Ketua Perangkawan Malaysia Dato’ Sri Dr. Mohd Uzir Mahidin berkata,
“Tujuan pembentangan hari ini adalah untuk membentangkan dan
memaklumkan prestasi ekonomi bagi Suku Tahun keempat 2022.
“Pada suku keempat 2022, ekonomi Malaysia mencatatkan pertumbuhan 7%,
disokong oleh pengembangan berterusan dalam permintaan domestik,
pemulihan dalam pasaran buruh, permintaan produk E&E yang berdaya tahan
dan pemulihan aktiviti pelancongan.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
“Penyederhanaan daripada pertumbuhan tinggi pada suku ketiga 2022
berikutan langkah rangsangan ekonomi yang semakin berkurangan dan juga
kesan asas yang rendah pada suku ketiga 2021.
“Bagi keseluruhan tahun 2022, ekonomi Malaysia berkembang pada 8.7%.
Pada terma pelarasan musim suku tahun-ke-suku tahun, KDNK merosot 2.6%
berbanding pertumbuhan 1.9% pada suku ketiga 2022.”
Chief Statistician of Malaysia Dato’ Sri Dr. Mohd Uzir Mahidin said, “In the
fourth quarter of 2022, the Malaysian economy recorded a growth of 7.0%,
supported by the continued expansion in domestic demand, sustained recovery
in the labour market, resilient demand for E&E products and recovery in tourism
activities.
“The moderation from the high growth in the third quarter of 2022 reflects waning
support from stimulus measures, and the low base effect from the negative
growth in the third quarter of 2021.
“For 2022 as a whole, the Malaysian economy expanded by 8.7%. On a
seasonally adjusted quarter-on-quarter basis, GDP declined by 2.6%. It was
1.9% in the third quarter of 2022.”
Continued expansion, albeit at a slower pace, across all economic sectors
Chief Statistician of Malaysia Dato’ Sri Dr. Mohd Uzir Mahidin said, “On the
supply side, all sectors continued to expand.
“Growth in the services sector continued to be supported by both consumer-
and business-related services, following better labour market conditions and the
continued recovery in tourism activities.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
“The manufacturing sector was driven mainly by the expansion in E&E cluster,
and supported by the primary and consumer clusters, amid higher
petrochemical output as well as fulfilment of motor vehicle backlogs.
“The agriculture sector continued to expand as oil palm production benefitted
from improved yields following higher rainfall earlier in 2022 and easing labour
shortages.
“Growth in the mining sector was supported by sustained production from crude
oil and natural gas facilities.
“As for the construction sector, growth was driven mainly by the continued
progress of large infrastructure, commercial and industrial projects in the civil
engineering and non-residential subsectors.”
Domestic demand supported mainly by private sector expenditure
Chief Statistician of Malaysia Dato’ Sri Dr. Mohd Uzir Mahidin said, “On the
demand side, growth was supported by private sector expenditure.
“Private consumption growth was underpinned by improving labour market
conditions and policy measures. Spending was driven by consumption of
necessities and discretionary items such as transport, housing and utilities, as
well as recreational services and culture.
“Growth in private investment was driven by capital spending in both structures
and machinery and equipment (M&E) by firms. The expansion in public
investment reflects continued capital expenditure by public corporations.
“Public consumption growth remained supported mainly by Government
supplies and services spending.
“Net exports of goods and services recorded a stronger growth mainly on
account of resilient demand for E&E exports and higher travel receipts.”
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Higher current account surplus and FDI inflows
Chief Statistician of Malaysia Dato’ Sri Dr. Mohd Uzir Mahidin said, “Turning
to the balance of payments, the current account recorded a higher surplus of
RM25.7 billion, or 5.5% of GDP. This was supported mainly by higher goods
surplus, driven by larger moderation in imports relative to exports.
“In addition, the services deficit narrowed due to higher travel receipts of RM27.9
billion following further recovery in tourism activities. Inbound travel which
consist of foreign visitors expenditure in Malaysia had reached
33.9 per cent of RM82.1 billion in pre-pandemic level.
“Beside that, higher receipts in Construction and lower payments for Transport
also contributed to the smaller deficit in Services.
“Moreover, Primary income recorded a lower deficit of RM11.5 billion during the
quarter amid higher income receipt by Malaysian investors abroad.
“Looking at the financial account, FDI recorded a higher net inflow of RM19.3
billion during the quarter due to inflows in debt instruments and continued equity
injections by foreign investors. These investments were channelled mainly into
the manufacturing sector and non-financial services subsectors particularly in
Information and communication. Major FDI receipts are mainly from the United
State of America, Switzerland and Singapore.
“Overall in 2022, Malaysia’s CAB continued to record a surplus of RM47.2 billion
as compared to RM58.7 billion a year ago, representing 2.6 per cent to GDP.
Meanwhile, total net FDI inflows amounted to RM73.3 billion, increased by
RM25.1 billion as compared to last year (2021: RM48.1 billion; average 2011-
2019: RM36.6 billion).
“I would like to recap that Malaysia’s overall economic performance expanded
by 8.7 per cent in 2022, which is the highest growth since 2000.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
“Although the economy in 2022 has surpassed the pre-pandemic level of 2019,
three main sectors of the economy are still below the pre-pandemic level -
Mining and Quarrying, Construction and Agriculture sectors. In 2021, the
number of employed persons for these three sectors was 2.8 million, which was
still 0.1 million lesser than pre-pandemic data.
“Food & beverage, Accommodation, Real estate, Business services, Private
education and Other services activities were still below pre-pandemic, though
the overall Services sector has surpassed what was seen in 2019.
“In 2022, Inbound Travel expenditure increased to RM27.9 billion from RM0.3
billion in the preceding year. However, inbound travel is still below the pre-
pandemic levels, with tourist arrival accounting for 26.1 million.
“In comparison, Outbound Travel expenditure increased to RM29.6 billion, more
than half of the RM51.3 billion recorded at the pre-pandemic level.”
Going forward, domestic demand to remain the key driver of growth amid
challenging global environment
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “Let’s
now turn to the outlook for 2023. Overall, the Malaysian economy is expected
to grow at a more moderate pace, after coming-off a strong recovery in 2022.
“Global growth is projected to be lower in 2023, due mainly to tighter monetary
policy and elevated inflation. But a global recession is not expected.
“Against this challenging global backdrop, domestic demand will remain the key
driver of growth supported by continued recovery in the labour market and
implementation of investment projects.
“In addition, higher tourism activity will provide support to exports, partially
offsetting the effects of slowing global growth.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
“These factors will support the continued expansion of the economy. The
updated official growth forecast for this year will be announced when Budget
2023 is re-tabled on 24 February.”
Steady increase in employment and wages to remain supportive of
spending
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “The
labour market continued to strengthen in 4Q 2022 and is expected to remain
supportive of domestic demand.
“Employment improved steadily alongside a gradual decline in unemployment
and underemployment rates, following continued expansion in economic
activity.
“Going forward, indicators suggest that demand for workers remains relatively
resilient and would support job creation and income growth in 2023. Job
vacancies remained on an increasing trend since 3Q 2021, approaching pre-
crisis levels (4Q 2022: 192.4 thousand positions; 4Q 2019: 198 thousand). With
continued expansion in employment, wage growth is expected to be
forthcoming.”
Continuation of new and existing investment to support growth in 2023
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “Going
forward, the economy would benefit from the realisation of new and existing
projects.
“Recent investment intentions remain forthcoming with approved investments
totalling RM194 billion between Jan-Sep 2022. By sector, approved investments
were mainly in real estate, information and communications, and electrical and
electronics subsectors. The realisation of these approved investments will
provide support to growth.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
“Investment is also lifted by continued progress in large infrastructure projects,
particularly in communication and transport-related subsectors.”
Slowdown in export growth following weaker global demand to be partially
cushioned by improvement in travel receipts
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “On the
external front, exports of goods will be affected by the slowdown in global
demand.
“Nevertheless, this will be partly cushioned by improvement in exports of
services, given further recovery in tourist arrivals amid the reopening of China’s
international borders.”
Risk to growth: Remains tilted to the downside, arising primarily
from external factors
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “The
balance of risk to growth remains tilted to the downside, driven by external
factors. They include weaker-than-expected global growth, further escalation of
geopolitical tensions and re-emergence of significant supply chain disruptions.
“Despite the challenging environment, we do not discount the possibility of
growth being higher than expected. Upside risks could stem from stronger pent-
up demand in major economies and stronger recovery in the labour market and
tourism sector.”
Easing trend in global commodity prices have partly translated into lower
inflation in many countries
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “Let me
now turn to inflation.
“The current environment of high inflation is a global phenomenon. That said,
we have started to see some signs of moderation across countries, with inflation
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
starting to moderate in several economies. The lower inflation in part reflected
the easing cost environment, such as from global commodity prices.”
Headline inflation has peaked, but core inflation increased further
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “For
Malaysia, headline inflation moderated to 3.9% during the quarter. As expected,
the lower headline inflation was largely due to the lapse in the base effect of
electricity inflation.
“The moderation was also amid the easing trend in key global commodity prices.
Inflation for some key staple food items, such as fresh meat and eggs, also
moderated during the quarter.
However, core inflation increased further during the quarter to 4.2% (3Q 2022:
3.7%) amid continued strength in domestic demand.
“For 2022 as a whole, headline and core inflation averaged at elevated levels of
3.3% and 3.0%, respectively.”
Underlying inflation continued to be partly driven by demand factors
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “Now,
I want to spend a bit of time dissecting core inflation.
“As you know, headline inflation is driven by a number of factors. It primarily
reflects supply and demand factors, and volatile price items. On the other hand,
core inflation is a better proxy of underlying inflation that is affected by demand
factors.
“With this in mind, I want to stress 3 points: (1) Our inflation is driven mainly by
supply factors. (2) Nevertheless, the persistence of core inflation indicates that
demand factors do contribute to underlying price pressures. Unlike past trends,
core inflation is taking longer to moderate, amid high cost and demand
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
pressures. (3) The increase in OPR is therefore undertaken to manage the
demand pressures, which I'll elaborate in a minute. ”
Over the course of 2023, headline and core inflation to moderate but
remain elevated
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “Over
the course of 2023, headline and core inflation are expected to moderate but
remain at elevated levels amid lingering cost and demand pressures.
“Core inflation is expected to remain elevated in the near-term, given continued
strength in domestic demand. While demand pressures on prices are beginning
to ease, we need to closely monitor all relevant indicators to ensure that excess
demand does not push inflation higher.
“Existing price controls and fuel subsidies, and remaining spare capacity in the
economy, will continue to partly contain the extent of upward pressures to
inflation.
“Overall, the balance of risk to the inflation outlook is tilted to the upside. This
outlook is subject to changes to domestic policy, for example in subsidy
rationalisation, global commodity price developments and supply-related
disruptions.”
The OPR was maintained at 2.75% at the recent MPC meeting in January
2023
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “Let me
now explain our monetary policy. After a series of four OPR adjustments since
May 2022, the MPC decided to keep the OPR unchanged at 2.75% at the recent
meeting in January 2023.
“As I explained earlier, our current inflation is a combination of both supply and
demand factors. While we know that the OPR has a limited influence in
addressing cost-push price pressures, it is an important tool to manage demand
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
pressures. We have been seeing these demand pressures since the economy
reopened, which contributed to the persistence and pervasiveness of domestic
inflation. This has been the challenge of central banks around the world, with
some facing pressing demand pressures more than others, hence, the rather
aggressive monetary policy tightening in those economies.
“High inflationary pressures are very damaging to the economy and cause even
deeper hardships for the rakyat. It would hurt everyone’s purchasing power
especially for the lower income group, regardless whether you have a loan or
not. The increase in the OPR is intended to moderate demand pressures on
prices and thus, inflation.
“But it is important to remember that monetary policy works with a lag and it will
take some time before we start to see demand pressures easing. We have
moved in a measured and gradual pace, especially when compared to other
countries. The decision to maintain the OPR for now allows us to assess the
impact of our past OPR adjustments to the inflation and economy. This would
give us better clarity on the inflation and economic outlook amid the evolving
global economic environment, and how we act next.
“At the current OPR level, our monetary policy remains accommodative and
supportive of the economy. We acknowledge the delicate balance between
inflation and growth risks, especially in the context of the challenging
environment that we are currently facing.
“Going forward, we will continue to closely monitor the strength of domestic
demand conditions and the risks to domestic inflation and sustainable growth.
Further monetary policy normalisation would be informed by the evolving
conditions and their implications to the domestic inflation and growth outlook.”
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Credit growth moderated as loan repayments outpaced disbursements
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said,
“Turning to financing conditions, credit to the private non-financial sector grew
by 4.7% as at end of the fourth quarter.
“Outstanding business loans expanded by 3.3%, as the growth in loan
repayments continued to remain strong, outpacing that of loan disbursements.
That said, loan disbursements continued to record sustained growth, particularly
for working capital loans, as firms continued to utilise existing credit lines to
support their business activity. Investment-related loans also remained
forthcoming, particularly for the purchase of non-residential properties in the
wholesale and retail trade, and manufacturing sectors.
“For households, outstanding loans expanded by 5.5%. Growth in loan
repayments continued to be sustained, while loan disbursements grew at a
relatively slower pace. The more moderate growth in loan disbursements
(10.3%; 3Q 2022: 48.1%) reflected lower growth in loan applications (-12.8%;
3Q 2022: 56.3%), particularly for the purchase of houses.”
Financing remains accessible to SMEs in 4Q 2022
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said,
“Financing by banks and DFIs continued to support the ongoing recovery of
SMEs in the fourth quarter, with sustained growth in outstanding financing at
5%.
“Financing approvals and disbursements remained robust, sustaining above
quarterly levels last year. Disbursements, in particular, was exceptionally strong
throughout 2022, registering double-digit growth in all quarters, albeit
moderating slightly to 12.1% in the fourth quarter. Repayments, too, remained
intact on the aggregate level.”
Domestic financial conditions eased, driven by slower tightening of global
monetary policy and positive sentiments over the reopening of China
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “In the
fourth quarter of 2022, the domestic financial conditions eased following a
slower pace of global monetary policy tightening, along with indications that
inflation has peaked, especially in the US.
“Meanwhile, global investor risk sentiment improved, supported by the earlier-
than-expected reopening of the Chinese economy. This is demonstrated by the
10-year Malaysian government bond yields declining 34 basis points and the
FBM KLCI gaining 7%.”
The ringgit appreciated towards end-2022
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “Since
November 2022, the strength in the US dollar moderated as market participants
adjusted their expectations towards smaller interest rate increases by the US
Federal Reserve.
“Reflecting these global developments, the ringgit along with most regional
currencies, have since appreciated against the US dollar.
“So far in 2023, the ringgit remained on this appreciation path with a YTD
adjustment of 2.4%. The performance of the ringgit against the currencies of our
major trade partners has also remained broadly stable.
“Moving forward, the Bank will continue to monitor developments and ensure
orderly market conditions to support financial intermediation and economic
activity.”
Banks remain well-positioned to support financial intermediation needs
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said,
“Turning now to the banking system. On this, I want to highlight that the banking
system will continue to play an important role in supporting growth in 2023.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
“Owing to their financial strength backed by high levels of capital and liquidity
buffers, banks remain well-positioned to support the financing needs of the
domestic economy.
“Banks also maintain sufficient provisions against potential credit losses given
some household, corporate and SME borrowers remain vulnerable in the
current environment of elevated costs and softer growth outlook.”
Households are generally resilient to increases in borrowing costs amid
improving labour market conditions and continued availability of
assistance
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said,
“Improving labour market conditions and the continued availability of assistance
for borrowers has supported household borrowers in facing higher borrowing
cost.
“Based on a conservative simulation, household impairments are only expected
to increase marginally from further increases in borrowing costs. Only 0.1ppt of
the increase in impairments are expected to arise from simulated OPR
increases. Instead, the uneven nature of economic recovery plays a stronger
role in driving loan defaults.
“Going forward, the improving economic outlook and employment prospects will
continue to be of greater significance in supporting household debt servicing
capacity.
“Naturally some borrowers will continue to face financial distress. Assistance
remains available for such borrowers in the form of customised repayment
programmes from banks and AKPK to ensure these borrowers can sustainably
service their loans over the longer-term.”
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Summary
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Yunus said, “Let me
now conclude the briefing by reiterating a few key highlights.
“The Malaysian economy expanded by 7.0% in the fourth quarter of 2022,
supported by continued expansion in private consumption and investments,
improving labour market conditions, resilient demand for E&E goods and
recovery in tourism activities. Overall for 2022, the economy recorded a strong
growth of 8.7%.
“Meanwhile, headline and core inflation averaged 3.3% and 3.0% respectively
for the year. Over the course of 2023, headline and core inflation are expected
to moderate but remain at elevated levels amid lingering cost and demand
pressures.
“For 2023 growth, domestic demand will remain as key driver of growth given
the slowing global demand. I wish to stress that Malaysia will not go into a
recession this year.
“However, highly challenging and uncertain global environment will remain the
key risk to domestic growth going forward.”
Bank Negara Malaysia
10 February 2023
GDP Q4 2022 Presentation Slides
Sidang Akhbar
Prestasi Ekonomi Suku
10 Februari 2023
Keempat Tahun 2022
1
The global economy moderated further in 4Q 2022
Note:
1 GDP for the fourth quarter of 2022 are advanced or preliminary estimates except for China, Indonesia, and Philippines.
2 Inflation figures are aggregated across major countries based on their share of global growth. EA refers to Euro Area (EA-19).
Source: Macrobond, National authorities, International Monetary Fund, Bank Negara Malaysia estimates
5.5
7.1
3.5
4.4
4.5
5.7
Jan Apr Jul Oct
Inflation2
Emerging
Economies
Global Growth Developments
• Further slowdown in global
growth amid higher interest
rate and slower trade activity
• Severe COVID-19
resurgence in China affected
spending and production
activity
• Headline inflation began to
moderate, but remained
elevated
2022
Advanced
Economies
World
2
7.2
5.0
2.9
2.2 1.9 1.4 1.0
-0.9
7.6
5.7
3.9 4.2
2.3
3.1
1.9
4.0
-5
-3
-1
1
3
5
7
9
11
13
PH ID CH SG EA KR US TW
4Q22 3Q22
Real GDP Growth1
Annual change (%)
Dec
Malaysia’s GDP grew by 7.0% in 4Q 2022, bringing full year growth to 8.7%
Source: Department of Statistics Malaysia
Factors Supporting Growth in 4Q 2022
Monthly Real GDP Growth (Annual change, %)
Jul-22 Aug-22 Sep-22 Oct-22 Nov-22 Dec-22
15.8 15.3 11.6 7.0 5.7 8.3
0.7
-17.1
-4.5
3.6
5.0
8.9
14.2
7.0
-0.9
-15.1
-2.7
4.6
3.8 3.5
1.9
-2.6
-20
-10
0
10
20
1Q-20 2Q-20 3Q-20 4Q-20 1Q-21 2Q-21 3Q-21 4Q-21 1Q-22 2Q-22 3Q-22 4Q-22
Annual change (%)
q-o-q SA
Real GDP Growth
3
4.4
-5.5
3.1
8.7
2019 2020 2021 2022
Real GDP Growth (Yearly)
Annual change (%)
Moderation compared to 3Q 2022 due to ...
Sustained labour
market recovery
Waning support from
stimulus measures
and low base effect
Continued expansion
in domestic demand
Resilient demand for
E&E and recovery in
tourism activities
Continued expansion, albeit at a slower pace, across all economic sectors
4
13.2
3.9
3Q-22 4Q-22
Annual change (%)
16.7
8.9
3Q-22 4Q-22
Annual change (%)
ManufacturingServices Agriculture
Continued expansion in
E&E, primary and
consumer clusters
Support from both
consumer and business
services activities
Oil palm production
benefitted from higher
yields and easing labour
shortages
1.2
1.1
3Q-22 4Q-22
Annual change (%)
9.2
6.8
3Q-22 4Q-22
Annual change (%)
15.3
10.1
3Q-22 4Q-22
Annual change (%)
Mining Construction
Continued improvements
in oil and gas production
Progress of large
infrastructure, commercial
and industrial projects
Source: Department of Statistics Malaysia
4.5
2.4
3Q-22 4Q-22
Annual change (%)
Domestic demand supported mainly by private sector expenditure
Private Consumption
15.1
7.4
3Q-22 4Q-22
Annual change (%)
Private Investment Public Investment
18.7
23.4
3Q-22 4Q-22
Annual change (%)
Public Consumption Net Exports
Continued growth in
necessities and
discretionary spending
Driven by investment in
both structures and M&E
Continued capital
expenditure by public
corporations
Supported mainly by
Government supplies &
services spending
Resilient demand for E&E
and further recovery in
tourism activities
Updated
13.2
10.3
3Q-22 4Q-22
Annual change (%)
13.1
6.0
3Q-22 4Q-22
Annual change (%)
5
Source: Department of Statistics Malaysia
12.3
6.4
-7.8
13.8
19.3
6.4
13.7
-0.9
Total Equity
Injections
Debt
Instruments
Reinvestment
of Earnings
3Q22
4Q22
14.1
43.0
-9.6
-17.2
-2.1
25.7
51.7
-8.6
-11.5
-6.0
Current Account
Balance
Goods Services Primary
Income
Secondary
Income
3Q22
4Q22
Higher current account surplus and FDI inflows
Source: Department of Statistics Malaysia
RM bil
▪ Higher goods surplus due mainly to larger moderation in
imports
▪ Services deficit narrowed driven by higher travel
receipts
Current Account Foreign Direct Investment
RM bil
▪ Higher FDI inflows supported by inflows in debt
instruments and equity injections from foreign investors
▪ FDI was mainly channelled into the manufacturing sector
and non-financial services subsector
6
Current Account (% of GDP)
4Q 2022: 5.5%
2022: 2.6%
2021: 3.8%
FDI inflow 2022
2021
: RM73.3 bil
: RM48.1 bil
Going forward, domestic demand to remain the key driver of growth amid
challenging global environment
7
Continued recovery in labour market
Further improvement in employment and income prospects
Implementation of new and existing investment projects
Realisation of approved investment to support investment activity
Higher tourism activity
Further recovery in tourist arrivals amid reopening of China’s international borders
Slower global growth
Tighter monetary policy, elevated inflation and slower trade to weigh on global growth
Domestic
Growth
in 2023
3.5
3.9 3.7 3.6
2.4
1.3 1.1 1.0
1Q-20 2Q-20 3Q-20 4Q-20 1Q-21 2Q-21 3Q-21 4Q-21 1Q-22 2Q-22 3Q-22 4Q-22
15.7
15.8 15.9
1.5
2
2.5
3
3.5
4
4.5
5
14
15
15
16
16
17
1Q-20 2Q-20 3Q-20 4Q-20 1Q-21 2Q-21 3Q-21 4Q-21 1Q-22 2Q-22 3Q-22 4Q-22
T
h
o
u
s
a
n
d
s
Note: Private sector wages comprise wages of workers in the manufacturing and services sectors.
Source: Department of Statistics Malaysia and Bank Negara Malaysia estimates
Steady increase in employment and wages to remain supportive of spending
Million persons
Employment Levels
8
0
10
20
30
40
50
150
155
160
165
170
175
180
185
190
195
1Q-20 3Q-20 1Q-21 3Q-21 1Q-22 3Q-22
21.9
thousand positions
in 1Q-20
166.0
thousand positions
in 1Q-20
Vacancies and new job creations
continue to improve …
30.9
thousand positions
New job creation
in 4Q-22
Vacancies in 4Q-22
192.4
thousand positions
Continued expansion in employment led to gradual decline in
unemployment rate
Going forward, favourable demand for workers would remain
supportive of wage growth
4.7
7.8 8.0
5.6
2.4
4.8
3.3 1.6
1Q-20 2Q-20 3Q-20 4Q-20 1Q-21 2Q-21 3Q-21 4Q-21 1Q-22 2Q-22 3Q-22 4Q-22
Private Sector Wages
Annual change (%)
Real wages
Nominal wages
Unemployment & Time-related Underemployment Rate
Unemployment Rate
Time-related Underemployment Rate
% of labour force
Source: MIDA, newsflows
Continued realisation of multi-year infrastructure projects to
provide further lift to growth
211
167
309
194
2019 2020 2021 Jan-Sep 2022
Total
Realisation of approved investment to support overall
investment activity
MIDA Total Investment Approvals
RM Billion
Primary
Manufacturing
Services
Continuation of new and existing investment to support growth in 2023
Note: Progress bars are for graphic purposes only.
Source: Newsflows, Bank Negara Malaysia estimates
Key Infrastructure Projects Cumulative Progress Rate
ECRL
RM50.0 billion
2018 2022 2027
36%
LRT3
RM16.6 billion
2018 2022 2024
77%
MyDIGITAL 5G
RM16.5 billion
2021 2022 2031
47%
Pan Borneo Highway
(Sabah)
RM16.0 billion
2016 2022 2024
73%
9
1.9
-1.0
-8.6
15.4
12.8
5.4
2.4
2018 2019 2020 2021 2022e 2023f
Exports of Goods & Services
Global export volume
in goods & services
Annual change (%)
Slowdown in export growth following weaker global demand to be partially
cushioned by improvement in travel receipts
Exports growth to moderate, weighed down by weaker
global demand
e Estimate, f forecast
Source: Department of Statistics Malaysia and International Monetary Fund
10
Malaysia’s Exports and Global Trade Volume of Goods
Further recovery in tourist arrivals amid reopening of China’s
international borders to provide support to services exports
Tourist Arrivals
Million
2021:
0.1
2022e:
9.2
2019:
26.1
2020:
4.3
Malaysia’s Total Air Passenger Traffic1
Million
109
27
11
53 – 55
75 – 81
2019 2020 2021 2022e 2023f
e Estimate, f forecast
1 Includes domestic flights as well as inbound and outbound international flights. In contrast, tourist
arrivals refer to international inbound tourists only.
Source: Ministry of Tourism, Arts and Culture, Malaysia, Economic Outlook and Budget 2023 (Ministry of
Finance Malaysia) and Malaysian Aviation Commission
Risk to growth: Remains tilted to the downside, arising primarily
from external factors
11
Downside risks
▼ Weaker-than-expected global growth
▼ Further escalation of geopolitical tension
▼ Re-emergence of significant supply chain
disruptions including impact from climate
change
▼ More persistent inflation necessitating tighter
monetary policy
▼ Higher risk aversion in global financial
markets
Upside risks
▲ Stronger-than-expected pent-up demand
in major economies
▲ Stronger employment and income
conditions
▲ Larger improvement in tourism sector
▲ Faster-than-expected implementation of
investment following reforms
2.7
2.9
4.5
3.3
5.9
5.2
7.3
7.0
7.3
8.3
7.3
6.5
9.3
10.0
1.8
3.8
3.9
4.4
5.2
5.5
5.8
6.1
6.6
7.1
7.8
7.9
10.0
10.8
China
Japan
Malaysia
Vietnam
Korea
Indonesia
Thailand
India
Singapore
US
Australia
Philippines
Euro area
UK
4Q 22 3Q 22
Source: World Bank, Bloomberg and Department of Statistics Malaysia.
Easing trend in global commodity prices have partly translated into
lower inflation in many countries
… and inflation has begun to moderate in several economies,
albeit remaining elevated
(yoy, %)
0
40
80
120
160
200
Jan-19 Jul-19 Jan-20 Jul-20 Jan-21 Jul-21 Jan-22 Jul-22
Brent Grains indexIndex / USD per barrel
Brent, USD/barrel
Dec-22: 80.9
World Bank Grains Price Index
Dec-22: 143.9
Global commodity prices beginning to ease …
Global Inflation Key Commodity Prices
12
Headline inflation has peaked, but core inflation increased further
Headline inflation peaked in 3Q 2022 while core inflation
increased …
Note: Average of past inflation is calculated based on monthly frequency from Jan-11 to Dec-19
Source: Department of Statistics Malaysia, Bank Negara Malaysia estimates
13
… as CPI reached an elevated level in 2022
Annual Consumer Price Index (CPI)
120.6 121.5
125.1
118
120
122
124
126
2020
Index (2010=100)
13
0.7%
3.0%
Core CPI
120.1
123.1
127.2
116
118
120
122
124
126
128
2020
2.5%
3.3%
Headline CPI
Malaysia Inflation
3.8
4.1
-1.0
0.0
1.0
2.0
3.0
4.0
5.0
6.0
Jan-21 Apr-21 Jul-21 Oct-21 Jan-22 Apr-22 Jul-22 Oct-22
Headline inflation Core inflation
2011-2019 Avg.:
Headline 2.2
Core 2.0
Annual Change (%)
(4Q: 3.9; 3Q: 4.5)
2021 2022
2021 2022
(4Q: 4.2; 3Q: 3.7)
Source: Department of Statistics, Malaysia.
Note: Figures above the bars refer to annual inflation rate.
2.0
2.5
3.0
3.5
4.0
4.5
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14
Mar-22 to present
Apr-11 to May-12
Jan-14 to Feb-15
46.4
J
a
n
-2
0
J
u
n
-2
0
N
o
v
-2
0
A
p
r-
2
1
S
e
p
-2
1
F
e
b
-2
2
J
u
l-
2
2
D
e
c
-2
2
Underlying inflation continued to be partly driven by demand factors
Underlying inflationary pressures have
been more persistent
But pervasiveness of price increases
has gradually normalised
Sustained underlying inflation in part
reflecting demand factors
Selected Episodes of Core Inflation1
Exceeding 2%
Time taken for core inflation from exceeding 2% to revert to 2%
(months)
Core inflation1, %
1 Core inflation excludes price-administered, price-volatile items and estimated direct impact from consumption tax policy changes.
Source: Department of Statistics Malaysia and Bank Negara Malaysia estimates.
80
90
100
110
120
130
140
150
160
170
180
100
120
140
160
180
200
220
240
260
280
J
a
n
-2
0
M
a
r-
2
0
M
a
y
-2
0
J
u
l-
2
0
S
e
p
-2
0
N
o
v
-2
0
J
a
n
-2
1
M
a
r-
2
1
M
a
y
-2
1
J
u
l-
2
1
S
e
p
-2
1
N
o
v
-2
1
J
a
n
-2
2
M
a
r-
2
2
M
a
y
-2
2
J
u
l-
2
2
S
e
p
-2
2
N
o
v
-2
2
Retail trade
(Pre-pandemic level)
Online sales
(Pre-pandemic level)
Online sales
Retail trade (RHS)
Index
2011-19 Avg.: 46
IndexShare of CPI items (%)
Share of CPI Items Recording Month-on-Month
Price Increase (%)
Online Sales and Retail Trade
14
Over the course of 2023, headline and core inflation to moderate but remain
elevated
Key drivers of headline inflation in 2023
Elevated core inflation in the near term
Lingering cost pressures
Easing of supply-related factors and lower global commodity prices
Existing subsidies and price controls to partly contain inflationary pressures
Continued slack in the economy and labour markets would limit upward price adjustments
Outlook remains subject to changes to domestic policy, global commodity price developments and supply-related disruptions
15
The OPR was maintained at 2.75% at the recent MPC meeting in January 2023
Source: Bank Negara Malaysia
1.0
1.5
2.0
2.5
3.0
3.5
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Jan 2023:
2.75%
Overnight Policy Rate, OPR
%
Historical low
OPR level
Further normalisation to the degree of
monetary policy accommodation would be
informed by the evolving conditions and
their implications to the domestic inflation
and growth outlook
Monetary policy continues to be
accommodative
This allows the MPC to assess the impact of
the cumulative past OPR adjustments, given
the lag effects of monetary policy on the
economy
16
* Comprises loans to households and non-financial corporations by the banking system and development financial institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers).
Starting with the 4Q 2022 Quarterly Bulletin, this series is introduced to enhance the quality of data on financing channelled towards the generation of domestic economic activity. ** Includes loans for the purchase of
consumer durable goods, credit cards and other purposes. *** Includes loans for the purchase of non-residential property, consumer durable goods, credit cards and other purposes.
Note: Numbers may not add up due to rounding.
Source: Bank Negara Malaysia
Credit growth moderated as loan repayments outpaced disbursements
Credit to the private non-financial sector
grew by 4.7% as at end of 4Q 2022
22
For both businesses and households, loan repayment growth outpaced
that of disbursements
Outstanding Business Loan Growth
Annual change (%) / Cont. to growth (ppt)
4.5 4.2
5.0 4.8
3.3
4Q-21 1Q-22 2Q-22 3Q-22 4Q-22
Others**
Investment-
related
Working
Capital
Total
Business Loan Disbursements and Repayments
Annual change (%)
3.0
28.2
18.0
12.0
5.0
26.3
24.5
16.0
1Q-22 2Q-22 3Q-22 4Q-22
Loan Disbursements
Loan Repayments
Outstanding Household Loan Growth
4.0 4.6
5.4
6.2
5.5
4Q-21 1Q-22 2Q-22 3Q-22 4Q-22
Others***
Personal use
Securities
Cars
Houses
Total
Annual change (%) / Cont. to growth (ppt)
Household Loan Disbursements and Repayments
Annual change (%)
11.3
25.1
48.1
10.3
5.3 15.1
37.6
21.4
1Q-22 2Q-22 3Q-22 4Q-22
Loan Disbursements
Loan Repayments
2.3 2.7 3.1 2.7
1.2
1.5
1.4
1.0
0.8
0.8
0.9
1.0
4.3
5.0
5.3
4.7
1Q 2022 2Q 2022 3Q 2022 4Q 2022
Outstanding corporate bonds
Outstanding business loans
Outstanding household loans
Credit to the Private Non-Financial Sector
Credit to the Private Non-Financial Sector*
Annual change (%) / Cont. to growth (ppt)
17
Financing remains accessible to SMEs in 4Q 2022
SME financing continued to expand,
growing 5.0% on an annual basis
Financing flows to SMEs remained robust in 4Q 2022 surpassing 2021 and
pre-pandemic levels, with repayment capacity remaining intact
Note: Reflects loans from the banking system and development financial institutions (DFIs)
Source: Bank Negara Malaysia
67
36
129 126
0
20
40
60
80
100
120
140
Applications Approvals Disbursements Repayments
3Q-22 4Q-22 2018-19 quarterly average
SME Financing Indicators
Annual
change in
4Q 2022
RM bil
Outstanding SME Financing
0.3% 12.6% 12.1% 14.6%
5.0%
6.4%
5.7%
4Q 2022
3Q 2022
4Q 2021
% yoy
18
Performance of Equity Indices (% Change)
Equity markets improved, reflecting better investor risk appetite
Updated
The decline in domestic bond yields towards year end partially
reversed the earlier losses in the bond market
US: United States; PH: the Philippines; UK: United Kingdom; MY: Malaysia; TH: Thailand; SG: Singapore;
KR: South Korea; CH: China; JP: Japan; ID: Indonesia.
Source: Bloomberg and Bursa Malaysia
*Regional countries include Indonesia, the Philippines, Singapore, South Korea and Thailand.
Source: Bank Negara Malaysia and ETP
81.0
-34.0
162.8
-35.5
231.9
4.6
-80
-30
20
70
120
170
220
270
320
1Q22 - 3Q22 4Q22
Malaysia Regional Average* US
Movement of 10-Year Local Currency Sovereign Bond Yields (in bps)
Domestic financial conditions eased, driven by slower tightening of global
monetary policy and positive sentiments over the reopening of China
-2.7
0.6
2.1
3.8
3.9
5.0
7.2
8.1
14.4
15.4
7.0
-9.9
-16.9
-27.6
0.2
-4.1
-11.0
-6.6
-19.4
-24.8
-30 -20 -10 0 10 20
1Q22-3Q22
4Q22
ID
JP
CH
KR
SG
TH
MY
UK
PH
US
19
The ringgit appreciated towards end-2022
Broad-based appreciation of major and regional currencies
was driven by weakening of the US dollar
Updated
US Dollar Index (DXY) and Selected Currencies against the US Dollar (%)
20
-2.2
-1.7
3.1
3.3
5.2
5.3
6.5
7.2
8.2
9.2
9.4
10.4
13.6
-7.7
IDR
INR
CNY
TWD
PHP
MYR
AUD
SGD
GBP
EUR
THB
JPY
KRW
DXY*
-15.0 -10.0 -5.0 0.0 5.0 10.0 15.0 20.0
4Q 22 Year-to-date (7 Feb '23)
* The US dollar Index (DXY) is an index of the value of the US dollar against a basket of foreign currencies,
namely EUR (57.6%), JPY (13.6%), GBP (11.9%), CAD (9.1%), SEK (4.2%), and CHF (3.6%).
Source: Bloomberg
The ringgit also strengthened against the currencies of some
major trade partners
Performance of the Ringgit against Selected Currencies (%)
* NEER refers to the ringgit nominal effective exchange rate, an index measuring ringgit’s performance against
currencies of Malaysia’s major trading partners.
Source: Bank Negara Malaysia and Bloomberg
-7.4
-4.3
-3.4
-3.0
-1.9
-1.3
-0.1
0.9
1.9
2.3
5.3
7.1
7.5
0.4
KRW
JPY
THB
EUR
GBP
SGD
PHP
AUD
TWD
CNY
USD
INR
IDR
NEER*
-15.0 -10.0 -5.0 0.0 5.0 10.0
4Q 22 Year-to-date (7 Feb '23)
Positive indicates
currency appreciation
Positive indicates
currency appreciation
Banks remain well-positioned to support financial intermediation needs
… to buffer against potential credit losses
1 Refers to the share of loans that have exhibited deterioration in credit risk, for which banks are required to set aside provisions based on lifetime expected losses.
* MFRS 9 - Malaysian Financial Reporting Standard 9.
Source: Bank Negara Malaysia
21
The financial position of banks remains
strong, lending support to financial
intermediation activities
Total Capital Ratio, %
Liquidity Coverage Ratio, %
Total Provisions, as % of loans
Banks continue to maintain sufficient
loan loss provisions …
153.4
150.5
148.3
152.5
154.0
Dec-21 Mar-22 Jun-22 Sep-22 Dec-22
19.2
18.3 18.3 17.8 18.3
Dec-21 Mar-22 Jun-22 Sep-22 Dec-22
1.8
1.8 1.8 1.8
1.7
Dec-21 Mar-22 Jun-22 Sep-22 Dec-22
2010-2019 Average: 1.73%
Gross Impaired Loans Ratio (%)
1.7 1.7
1.8 1.8
1.7
1.3
1.4
1.5
1.6
1.7
1.8
1.9
2.0
2.1
7.5
8.0
8.5
9.0
9.5
10.0
10.5
11.0
11.5
12.0
12.5
Dec-21 Mar-22 Jun-22 Sep-22 Dec-22
2010-2019 Average: 1.93%
MFRS 9* Stage 2 Loans1 Ratio (%)
11.0 10.9
10.1
9.6
8.8
7.5
8.0
8.5
9.0
9.5
10.0
10.5
11.0
11.5
12.0
12.5
Dec-21 Mar-22 Jun-22 Sept-22 Dec-22
2018-2020 Average: 8.0%
1 Impairment ratio based on Stage 3 loans under MFRS 9 while delinquency ratio is based on loans with 2 months-in-arrears.
2 The equivalent ratios as proportion of overall banking system loans are 0.73%, 1.41% and 1.44% respectively.
3 Assumes some borrowers would still experience unemployment and income shocks due to uneven nature of recovery. No change in OPR.
4 Assumes OPR rises to its highest level since the GFC resulting in increased borrowing costs.
5 As a share of total bank and DFI loans.
The quality of household borrowings
remains sound amid improving labour
market conditions
The increase in household impairments from a conservative simulation of further
increases in borrowing costs is expected to be modest
Source: Bank Negara Malaysia estimates
Actual
(Dec-22)
Baseline with
No R&R
High Inflation
+ 200bps OPR
Hike
2.4%
2.5%
Simulated
OPR Hikes4
Simulated Household Impairments by end-2023
(ratio, % of total household loans in banking system2)
+1.2 ppt
+0.1 ppt
1.2%
1.2% 1.2%
0.7%
0.8%
0.0%
0.4%
0.8%
1.2%
1.6%
Dec-21 Mar-22 Jun-22 Sep-22 Dec-22
Loan impairment Loan delinquency
Household Sector Loan Impairment and
Delinquency Ratios
(ratio, % of total household loans in banking system1)
Household debt servicing capacity continues to
be supported by:
Improving income and employment
conditions
1
Healthy loan servicing buffers
37% median debt service ratio of
outstanding loans
2
Continued availability of assistance
1.9% household exposures5 remain under
repayment assistance
3
2000 – 2009 average: 8.8%
2010 – 2019 average: 1.3%
Simulated
Uneven
Recovery3
Actual
(Dec-22)
Households are generally resilient to increases in borrowing costs amid
improving labour market conditions and continued availability of assistance
22
Growth in 2023 to be supported by domestic demand amid global slowdown.
Malaysia will not go into a recession.
The outlook, however, is subject to risks related to weaker-than-expected global
growth, further escalation of geopolitical tensions, re-emergence of significant supply
chain disruptions, more persistent inflation necessitating tighter monetary policy
and higher risk aversion in global financial markets.
Summary
Updated
In 4Q 2022, the Malaysian economy grew by 7.0% underpinned by continued
expansion in domestic demand and resilient demand for E&E goods.
For 2022, the economy grew by 8.7%.
Headline and core inflation averaged 3.3% and 3.0% respectively in 2022.
23
End of Presentation
Q&A
Q&A
BANK NEGARA MALAYSIA
CENTRAL BANK or MALAYSIA
Additional Information
Add. Info
1
Breakdown of 4Q GDP (% yoy)
Annual Change in GDP Growth by Component
1 Numbers do not add up due to rounding and exclusion of import duties component.
Source: Department of Statistics, Malaysia
Real GDP
(% YoY)
Share, %
(2022)
2021 2022
4Q 3Q 4Q Overall
Domestic Demand
(Excluding Stocks)
93.1 1.9 13.1 6.8 9.2
Private Sector 75.6 2.5 14.7 7.9 10.4
Consumption 60.2 3.7 15.1 7.4 11.3
Investment 15.4 -2.8 13.2 10.3 7.2
Public Sector 17.5 0.1 6.3 3.5 4.3
Consumption 13.2 1.6 4.5 2.4 3.9
Investment 4.4 -3.4 13.1 6.0 5.3
Net Exports of Goods
and Services
5.4 0.8 18.7 23.4 -1.8
Exports 71.7 13.0 23.9 9.6 12.8
Imports 66.3 14.5 24.4 8.1 14.2
Change in stocks, RM bil. 1.5 3.8 3.9 0.4 21.9
Real GDP 100.0 3.6 14.2 7.0 8.7
Real GDP
(% YoY)
Share1, %
(2022)
2021 2022
4Q 3Q 4Q Overall
Services 58.2 3.2 16.7 8.9 10.9
Manufacturing 24.2 9.1 13.2 3.9 8.1
Agriculture 6.6 2.8 1.2 1.1 0.1
Mining and Quarrying 6.4 -0.6 9.2 6.8 3.4
Construction 3.5 -12.2 15.3 10.1 5.0
Real GDP 100.0 3.6 14.2 7.0 8.7
26
Breakdown of 4Q GDP (ppt contribution)
Percentage Point Contribution to GDP Growth by Component
1 Numbers do not add up due to rounding and exclusion of import duties component.
Source: Department of Statistics, Malaysia
Real GDP
(Ppt contribution, %)
Share, %
(2022)
2021 2022
4Q 3Q 4Q Overall
Domestic Demand
(Excluding Stocks)
93.1 1.8 12.3 6.3 8.5
Private Sector 75.6 1.8 11.2 5.5 7.8
Consumption 60.2 2.1 9.2 4.3 6.6
Investment 15.4 -0.4 2.0 1.3 1.1
Public Sector 17.5 0.0 1.1 0.8 0.8
Consumption 13.2 0.3 0.6 0.4 0.5
Investment 4.4 -0.2 0.5 0.4 0.2
Net Exports of Goods
and Services
5.4 0.1 1.0 1.6 -0.1
Exports 71.7 8.2 16.3 6.6 8.9
Imports 66.3 8.2 15.2 5.0 9.0
Change in Stocks 1.5 1.8 0.8 -0.9 0.3
Real GDP 100.0 3.6 14.2 7.0 8.7
Real GDP
(Ppt contribution, %)
Share1, %
(2022)
2021 2022
4Q 3Q 4Q Overall
Services 58.2 1.9 9.5 5.1 6.2
Manufacturing 24.2 2.1 3.2 1.0 2.0
Agriculture 6.6 0.2 0.1 0.1 0.0
Mining and Quarrying 6.4 0.0 0.6 0.4 0.2
Construction 3.5 -0.5 0.5 0.3 0.2
Real GDP 100.0 3.6 14.2 7.0 8.7
Add. Info
2
27
Financial account recorded a smaller net outflow in the quarter
Outflows from portfolio and direct investment accounts were partially offset by net inflows in other investment account
RM bil
2021 2022
Year 3Q 4Q Year
Direct Investment 28.5 2.0 -9.4 16.0
Direct Investment Abroad (DIA)* -19.7 -10.3 -28.7 -57.3
Foreign Direct Investment (FDI)* 48.1 12.3 19.3 73.3
Portfolio Investment 18.8 0.1 -26.7 -51.3
Residents -35.8 2.6 -15.0 -30.6
Non-residents 54.6 -2.5 -11.7 -20.7
Financial Derivatives -2.3 -0.4 -1.7 -2.2
Other Investment -32.0 -16.6 36.8 52.3
Financial Account Balance 13.0 -14.9 -1.0 14.8
Continued FDI inflows amid higher
DIA outflows
Net inflows in other investment
Net outflows in portfolio investment
Add. Info
3
*As per the IMF’s BPM5 classifications (i.e. directional basis).
Note: Numbers may not add up due to rounding.
Source: Department of Statistics, Malaysia and Bank Negara Malaysia
28
Overall, financial account recorded a net inflow in
2022. Inflows from other investment and direct
investment accounts more than offset net
outflows from portfolio investment account
2.8
-19.4
-8.4
-0.4*
Banks Corporates Fed. Gov. BNM
Net change: -RM25.4 bil
Malaysia’s external debt remains manageable
External debt amounted to 64.0% of
GDP as at end-4Q 2022
Corporates’ external debt is largely
subject to prudential safeguards
L
* Consist of deposit & interbank placements, bonds and notes, and
money market instruments.
** Consist of short-term financial institutions’ deposits, interbank
borrowings and loans from unrelated counterparties.
Banks are resilient to face potential
external shocks
Add. Info
4
Changes in External Debt by Institution
(from 3Q 2022) (RM bil)
* Reflecting exchange rate valuation changes on the allocation of
SDR held by BNM.
Banks’ FCY Liquid External Assets* and FCY
External Debt-at-Risk** (RM bil)
136.5
80.4
FCY liquid external
assets
FCY external
debt-at-risk
66.1
111.0
149.9
88.9
31.7
13.2
RM bil
Bonds and notes
Loans
Other debt liabilities
Intragroup loans
Trade credits
NR holdings of domestic debt securities
Subject to
hedging
requirements
On
concessionary
and flexible
terms
Backed by
export earnings
Corporate External Debt Breakdown by
Instrument (as at 4Q 2022)
Total: RM460.8 billion
Source: Department of Statistics, Malaysia and Bank Negara Malaysia
29
Adequate buffers to weather external shocks
Sustained net creditor position … … and further supported by
L
External Assets Minus External Liabilities
(4Q 21 – 4Q 22)
Source: Department of Statistics, Malaysia and Bank Negara Malaysia
… with large net foreign-currency
assets …
5.5
3.0
3.7
4.4
3.5
0
2
4
6
8
0
20
40
60
80
100
120
4Q-21 1Q-22 2Q-22 3Q-22 4Q-22
Net IIP Position (LHS)
% of GDP (RHS)
RM bil % of GDP
Sustained foreign income
Continued current account surplus reduces
external financing requirements
Sufficient international reserves to
facilitate international transactions
… to finance 5.1 months of imports of goods
& services and is 1.1 times total short-term
external debt as at 31 January 2023*
Add. Info
5
30
* Note: The reserves adequacy ratios differ from those published in the
press statement on international reserves as at 31 January 2023 as they
reflect the latest 4Q 2022 data on imports of goods & services and short-
term external debt.
2,117.9
957.2
FCY Assets FCY Liabilities
FCY Denominated External Assets & Liabilities
(End-4Q 2022) (RM bil)
Default Section
Slide 1
Part A: Developments
Slide 2: The global economy moderated further in 4Q 2022
Slide 3: Malaysia’s GDP grew by 7.0% in 4Q 2022, bringing full year growth to 8.7%
Slide 4: Continued expansion, albeit at a slower pace, across all economic sectors
Slide 5: Domestic demand supported mainly by private sector expenditure
Slide 6: Higher current account surplus and FDI inflows
Part B: Outlook
Slide 7: Going forward, domestic demand to remain the key driver of growth amid challenging global environment
Slide 8: Steady increase in employment and wages to remain supportive of spending
Slide 9
Slide 10: Slowdown in export growth following weaker global demand to be partially cushioned by improvement in travel receipts
Slide 11: Risk to growth: Remains tilted to the downside, arising primarily from external factors
Slide 12: Easing trend in global commodity prices have partly translated into lower inflation in many countries
Slide 13: Headline inflation has peaked, but core inflation increased further
Slide 14: Underlying inflation continued to be partly driven by demand factors
Slide 15: Over the course of 2023, headline and core inflation to moderate but remain elevated
Slide 16: The OPR was maintained at 2.75% at the recent MPC meeting in January 2023
Part C: Monetary and Financial Developments
Slide 17: Credit growth moderated as loan repayments outpaced disbursements
Slide 18: Financing remains accessible to SMEs in 4Q 2022
Slide 19: Domestic financial conditions eased, driven by slower tightening of global monetary policy and positive sentiments over the reopening of China
Slide 20: The ringgit appreciated towards end-2022
Slide 21: Banks remain well-positioned to support financial intermediation needs
Slide 22: Households are generally resilient to increases in borrowing costs amid improving labour market conditions and continued availability of assistance
Part D: Summary
Slide 23: Summary
Slide 24
Slide 25
Additional Information
Slide 26
Slide 27: Breakdown of 4Q GDP (% yoy)
Slide 28: Breakdown of 4Q GDP (ppt contribution)
Slide 29: Financial account recorded a smaller net outflow in the quarter
Slide 30: Malaysia’s external debt remains manageable
Slide 31: Adequate buffers to weather external shocks
Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to Imports of Goods and Services
27Quarterly Bulletin | 4Q 2021
Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to
Imports of Goods and Services
One of the indicators used by the Bank to measure international reserve adequacy is the reserve coverage
of retained imports,1 which is communicated on a fortnightly basis. As the economy grew and evolved with
higher share of the services sector, this has raised the prominence of services imports in the measure of
reserve adequacy. Given this consideration and in line with the international best practice, future fortnightly
reporting of Malaysia’s international reserves will include the indicator on reserve coverage of imports of
goods and services, effective from 22 February 2022.2
1 Defined as gross imports subtracted with re-exports. The 12-month average retained imports can be derived from the Monthly Highlight and Statistics Table
3.6.8 (Imports by End-Use; see Appendix 1).
2 For the international reserves position as at 15 February 2022.
3 Defined as imports plus exports.
4 From RM101.3 billion to RM351.3 billion, or a compound annual growth rate (CAGR) of 6.4%.
5 Based on JP Morgan’s Government Bond Index for Emerging Markets.
Services tradeC1
0
100
200
300
400
1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021
RM billion
Travel1
Computer and information
Transport
Manufacturing
Other business3
Other2
Perdagangan perkhidmatanR1
0
100
200
300
400
1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021
RM bilion
Perjalanan1
Komputer dan informasi
Pengangkutan
Pembuatan
Perniagaan Lain3
Lain-lain2
Nota: Data sebelum tahun 2005 adalah berdasarkan garis panduan dalam Edisi Kelima Manual Imbangan Pembayaran dan Kedudukan
............Pelaburan Antarabangsa (BPM5) IMF. Data bagi tahun 2005 dan selanjutnya adalah berdasarkan BPM6.
1 Termasuk perbelanjaan perjalanan bagi aktiviti pelancongan.
2 Termasuk pembinaan, caj penggunaan harta intelek, perkhidmatan persendirian, kebudayaan dan rekreasi.
3 Perkhidmatan perniagaan lain termasuk perkhidmatan penyelidikan dan pembangunan, profesional, teknikal, berkaitan perdagangan dan
...perkhidmatan perniagaan lain.
Sumber: Jabatan Perangkaan Malaysia dan Bank Negara Malaysia
Note: Data prior to 2005 are based on the guideline in the Fifth Edition of the Balance of Payments and International Investment Position
............Manual (BPM5) of the IMF. Data for 2005 and beyond are based on BPM6.
1 Includes travel spending for tourism activity.
2 Includes construction, charges for intellectual property use, personal, culture & recreational services.
3 Other business services comprise research and development, professional, technical, trade-related and other business services.
Source: Department of Statistics, Malaysia and Bank Negara Malaysia
The Bank’s reporting of the reserve coverage of retained imports was published as early as in the 1990s. Data
on retained imports are available on monthly basis and thereby closely match the fortnightly release of the
international reserves data. However, retained imports do not include payment for services, which has grown
over the past two decades. From 1999 to 2019, services trade3 has increased by 246.9%4 (Chart 1). This was
mainly due to higher tourism activity as well as payments for foreign transport services for goods trade. In
addition, there was also an expansion in goods import, largely in support of domestic investment activities
and production of manufactured goods.
Malaysia’s performance on this indicator is in line with regional and peer5 economies. On historical basis,
reserve coverage of imports of goods and services indicator has been in the range of between 5 and 8
months since 2008 – well above the generally-accepted ‘rule of thumb’ adequacy threshold of 3-months, and
demonstrates the ability of the Malaysian economy to withstand against external shocks.
28 Quarterly Bulletin | 4Q 2021
It is also important to emphasize that the assessment of reserve adequacy should not be solely based
on the face value of these indicators. This needs to be complemented with deeper understanding about
the country’s external position, financial system and broad economic policies. In particular, international
reserves is not the only means to meet external obligations.6 Prevailing assessment indicates that the
country’s external position7 is underpinned by its strong economic fundamentals including healthy current
account surplus, large foreign currency external assets held by domestic entities8 and the flexible ringgit
exchange rate.
References
Department of Statistics, Malaysia. ‘External Sector’, Jabatan Perangkaan Malaysia, Putrajaya.
Greenspan, A., ‘Currency reserves and debt’. Remarks before the World Bank Conference on Recent Trends in
Reserves Management, Washington, DC, 29 April 1999.
International Monetary Fund, (2016). ‘Guidance Note on the Assessment of Reserve Adequacy and Related
Considerations’.
Appendix 1: Calculation of international reserves coverage of retained imports
aFor example, to calculate monthly retained imports for December 2019, the retained imports for the months of
January to December 2019 is summed up (i.e. rolling 12-months of retained imports). This number is then divided
by 12, to obtain a monthly average. The figures can be obtained from BNM’s MHS Table 3.6.8, column S.
6 Further information can be found in the box article “Malaysia’s Resilience in Managing External Debt Obligations and the Adequacy of International Reserves”
in BNM’s Annual Report 2018.
7 In addition, it has also been emphasized that Malaysia’s external debt position, including short-term external debt, remains manageable. This is supported by
the favourable currency and maturity profile on its external debt as well as domestic entities’ resilient repayment capacity. Foreign-currency external debt of
corporates are also mainly subject to prudential and hedging requirements (refer to the latest assessment on external debt developments on page 25)
8 Amounting to RM1.1 trillion as at end-2021.
| Press Release |
09 Feb 2023 | International Reserves of Bank Negara Malaysia as at 31 January 2023 | https://www.bnm.gov.my/-/bnm-statement-of-assets-liabilities-31-january-2023-1 | https://www.bnm.gov.my/documents/20124/6118085/qb2021q4_en_box_imports.pdf | null |
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International Reserves of Bank Negara Malaysia as at 31 January 2023
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International Reserves of Bank Negara Malaysia as at 31 January 2023
Embargo :
For immediate release
Not for publication or broadcast before
1500 on
Thursday, 9 February 2023
9 Feb 2023
The international reserves of Bank Negara Malaysia amounted to USD115.2 billion as at 31 January 2023. The reserves position is sufficient to finance 5.3 months of imports of goods and services[1], and is 1.0 time of the total short-term external debt.
[1] Under the previous import coverage measure, reserves is sufficient to finance 6.2 months of retained imports of goods. For more information on the new indicator, please refer to the article on “Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to Imports of Goods and Services” in BNM’s Quarterly Bulletin for the Fourth Quarter of 2021 publication, page 27, which can be accessed at Quarterly Bulletin 4Q 2021 Related Assets
BNM Statement of Assets & Liabilities - 31 January 2023
Bank Negara Malaysia
9 February 2023
© Bank Negara Malaysia, 2023. All rights reserved.
|
Monthly Highlights
Headline inflation declined to 3.4% in March
March 2023
1
3.7 3.4
3.9 3.8
0.00
2.00
4.00
0.0
2.0
4.0
J
a
n
-2
2
F
e
b
-2
2
M
a
r-
2
2
A
p
r-
2
2
M
a
y
-2
2
J
u
n
-2
2
J
u
l-
2
2
A
u
g
-2
2
S
e
p
-2
2
O
c
t-
2
2
N
o
v
-2
2
D
e
c
-2
2
J
a
n
-2
3
F
e
b
-2
3
M
a
r-
2
3
Food & non-alcohol (29.5%) Housing & utilities (23.8%)
Transport (14.6%) Others (32.1%)
Headline inflation (RHS) Core inflation¹ (RHS)
Contribution to Inflation
ppt. contribution %, yoy
1 Core inflation is computed by excluding price-volatile and price-administered items.
Source: Department of Statistics, Malaysia & Bank Negara Malaysia estimates
• Headline inflation declined to 3.4% in March
(February: 3.7%) due mainly to lower inflation for
fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation moderated slightly to 3.8% during
the month (February: 3.9%), driven largely by
lower inflation for food away from home.
1
Robust growth in volume index driven by retail and motor vehicles
Index of Wholesale and Retail Trade
Source: Department of Statistics, Malaysia
• The Index of Wholesale and Retail Trade
(IOWRT) expanded by 10.6% in February 2023
(January: 8.5%).
• The higher growth was driven mainly by retail
sales in non-specialised stores (e.g., department
stores) followed by continued strength in
purchases of motor vehicles amid the ongoing
fulfilment of backlog orders.
• On a month-on-month seasonally adjusted basis,
the index accelerated by 5.5% (January: 0.2%).
9.5 8.510.6
0
10
20
30
40
Feb-
22
Mar-
22
Apr-
22
May-
22
Jun-
22
Jul-
22
Aug-
22
Sep-
22
Oct-
22
Nov-
22
Dec-
22
Jan-
23
Feb-
23
ppt, %yoy
Motor vehicles Retail Wholesale
2.4
5.2
4.4
0
1
2
3
4
5
6
7
Mar-22 Jul-22 Nov-22 Mar-23
Business loans
Household loans
Corporate bonds
Annual growth (%)
Growth in credit to the private non-financial sector moderated
1 Comprises loans to households and non-financial corporations from the
banking system and development financial institutions (DFIs), and corporate
bonds issued by non-financial corporations (including short-term papers).
2 Starting with the publication of December 2022 Monthly Highlights and
Statistics (MHS), this series was introduced to enhance the quality of
financing data. This new data series is available in the MHS Table 2.18.
Source: Bank Negara Malaysia
2.7 2.6 2.7 2.6
1.0 0.6 0.7 0.7
1.0
1.1 1.1 0.9
4.7 4.3 4.5 4.2
Dec-22 Jan-23 Feb-23 Mar-23
Corporate Bonds
Business Loans
Household Loans
Credit to the Private Non-
Financial Sector
Contribution to growth (ppt)
• Credit to the private non-financial sector grew by
4.2% as at end-March (February: 4.5%), attributed
to slower growth in credit to businesses (3.2%;
February: 3.7%).
• While growth in outstanding corporate bonds
moderated (4.4%; February : 5.5%), outstanding
business loan growth was sustained at 2.4%
(February: 2.4%). This was supported by the
continued growth in both working capital (2.2%;
February: 1.9%) and investment-related loans
(4.3%; February: 4.2%).
• Outstanding household loan growth remained
broadly stable (5.2%; February: 5.3%), supported
by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan
growth for the purchase of securities (-6.9%;
February: -3.3%).
Credit to the Private Non-Financial Sector1,2
Monthly Highlights
March 2023
Domestic financial market conditions remained orderly
Financial Market Performance in March 2023
Source: Bank Negara Malaysia, Bursa Malaysia
Note: The exchange rate data is the noon-rate in the Kuala Lumpur Interbank Foreign Exchange Market
11.0
-2.1
-5.3
0.0
-2.2
1.7
10-year MGS
(bps, mom)
Equity
(%, mom)
Ringgit
(%, mom)
-10 -5 0 5 10 15
Mar-23
Feb-23
• In March, global financial markets were affected by
the emergence of banking sector stress in some
major economies. As spillovers were contained thus
far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds
improved.
• In line with the performance of regional currencies,
the ringgit appreciated by 1.7% against the US
dollar. Conditions in the domestic bond market
also remained stable.
• The FBM KLCI declined by 2.2% during the month.
2
Banks maintained strong liquidity and funding positions to support intermediation
Source: Bank Negara Malaysia
Banking System Liquidity and Funding Ratios
81.9
157.4
0
40
80
120
160
70
75
80
85
90
95
M
a
r
2
2
A
p
r
2
2
M
a
y
2
2
J
u
n
2
2
J
u
l
2
2
A
u
g
2
2
S
e
p
2
2
O
c
t
2
2
N
o
v
2
2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
% %
Liquidity Coverage Ratio (RHS)
Loan-to-Fund Ratio
Asset quality in the banking system remained intact
Banking System Asset Quality
Source: Bank Negara Malaysia
• Overall gross and net impaired loans ratios
increased slightly to 1.8% (February-23: 1.8%) and
1.2% (February-23: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory
reserves) continue to record a prudent level of
110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
%
1.8
1.2
1.7
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
M
a
r
2
2
A
p
r
2
2
M
a
y
2
2
J
u
n
2
2
J
u
l
2
2
A
u
g
2
2
S
e
p
2
2
O
c
t
2
2
N
o
v
2
2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
Gross Impaired Loans Ratio
Total Provisions to Total Loans Ratio
Net Impaired Loans Ratio
• Banks continued to record healthy liquidity buffers
with the aggregate Liquidity Coverage Ratio at
157.4% (February-23: 152.7%).
• The aggregate loan-to-fund ratio remained stable at
81.9% (February-23: 81.6%).
PRESS RELEASE
Ref. No.: 04/23/05 EMBARGO: Not for publication or
broadcast before 1500 hours on
Friday, 28 April 2023
Monthly Highlights – March 2023
Headline inflation declined to 3.4% in March
• Headline inflation declined to 3.4% in March (February: 3.7%) due mainly
to lower inflation for fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation1 moderated slightly to 3.8% during the month
(February: 3.9%), driven largely by lower inflation for food away from
home.
Robust growth in volume index driven by retail and motor vehicles
• The Index of Wholesale and Retail Trade (IOWRT) expanded by 10.6%
in February 2023 (January: 8.5%).
• The higher growth was driven mainly by retail sales in non-specialised
stores (e.g., department stores) followed by continued strength in
purchases of motor vehicles amid the ongoing fulfilment of backlog
orders.
• On a month-on-month seasonally adjusted basis, the index accelerated
by 5.5% (January: 0.2%).
1 Core inflation is computed by excluding price-volatile and price-administered items.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Growth in credit to the private non-financial sector2,3 moderated
• Credit to the private non-financial sector grew by 4.2% as at end-March
(February: 4.5%), attributed to slower growth in credit to businesses
(3.2%; February: 3.7%).
• While growth in outstanding corporate bonds moderated (4.4%;
February: 5.5%), outstanding business loan growth was sustained at
2.4% (February: 2.4%). This was supported by the continued growth in
both working capital (2.2%; February: 1.9%) and investment-related
loans (4.3%; February: 4.2%).
• Outstanding household loan growth remained broadly stable (5.2%;
February: 5.3%), supported by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan growth for the purchase of
securities (-6.9%; February: -3.3%).
Domestic financial market conditions remained orderly
• In March, global financial markets were affected by the emergence of
banking sector stress in some major economies. As spillovers were
contained thus far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds improved.
• In line with the performance of regional currencies, the ringgit
appreciated by 1.7% against the US dollar. Conditions in the domestic
bond market also remained stable.
• The FBM KLCI declined by 2.2% during the month.
Banks maintained strong liquidity and funding positions to support
intermediation
• Banks continued to record healthy liquidity buffers with the aggregate
Liquidity Coverage Ratio at 157.4% (February: 152.7%).
2 Comprises loans to households and non-financial corporations from the banking system and development financial
institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers).
3 Starting with the publication of December 2022 Monthly Highlights and Statistics (MHS), this series was introduced
to enhance the quality of financing data. This new data series is available in the MHS Table 2.18.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
• The aggregate loan-to-fund ratio remained stable at 81.9%
(February: 81.6%).
Asset quality in the banking system remained intact
• Overall gross and net impaired loans ratios increased slightly to 1.8%
(February: 1.8%) and 1.2% (February: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory reserves) continues to
record a prudent level of 110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
Bank Negara Malaysia
28 April 2023
20230428_BNM Monthly Highlights-March_en
Slide 1
Slide 2
20230428_BNM PR_Monthly Highlights-Mar 2023_eng
| Press Release |
31 Jan 2023 | Monetary and Financial Developments in December 2022 | https://www.bnm.gov.my/-/monetary-and-financial-developments-in-december-2022 | https://www.bnm.gov.my/documents/20124/9622731/i_en.pdf | null |
Reading:
Monetary and Financial Developments in December 2022
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2
Monetary and Financial Developments in December 2022
Embargo :
For immediate release
Not for publication or broadcast before
1500 on
Tuesday, 31 January 2023
31 Jan 2023
Headline inflation declined to 3.8% in December
Headline inflation declined to 3.8% in December (November: 4.0%) due to the continued moderation in fresh food and fuel inflation, as well as lower core inflation.
Core inflation[1] edged lower but remained high at 4.1% during the month (November: 4.2%). The lower core inflation largely reflected lower inflation for repair and maintenance for personal transport, bread and bakery products, and lotteries and gambling.
Export growth moderated in December
Exports grew by 6.0% (November: 15.1%) in December 2022. Overall, exports grew by 25.0% in 2022.
Manufactured export growth were driven by petroleum and E&E products. Meanwhile, commodities exports continued to be supported mainly by LNG and crude petroleum shipments.
Moving forward, the moderation in global growth and lower commodity prices are expected to weigh on Malaysia’s export growth.
Higher growth in credit to the private non-financial sector
Credit to the private non-financial sector[2] grew by 4.7% as at end-December (November: 4.4%), reflecting higher growth in credit to businesses (3.8%; November: 3.2%).
For businesses, the stronger credit growth was driven by higher growth for both outstanding corporate bonds (4.6%; November: 3.5%) and outstanding business loans (3.3%; November: 3.0%).
Outstanding household loans grew by 5.5% (November: 5.6%), as growth in loan repayments outpaced that of disbursements. Despite some moderation in outstanding loan growth for the purchase of housing and cars, growth in loan disbursements remained strong (10.4%; November: 9.1%).
Domestic financial conditions continued to ease, reflecting improving investors’ risk sentiment
Global financial conditions were mainly driven by expectations for a slower monetary policy tightening by major central banks moving forward, as inflation showed signs of peaking. Meanwhile, investors’ risk sentiment was supported further by the earlier-than-expected reopening of China’s international borders.
Subsequently, domestic financial conditions eased, with the 10-year MGS yields declining by 4.0 bps (regional[3] average: -4.4 bps). The FBM KLCI rose by 0.4% (regional average: -3.1%), contributed mainly by the plantation sector amid higher crude palm oil prices during the month.
The ringgit continued to appreciate against the US dollar (+0.9%), in line with the movement of other regional currencies (average: 2.0%).
Banks maintained strong liquidity and funding positions to support intermediation
The banking system overall Liquidity Coverage Ratio improved in December as banks were proactive in managing their buffers to address the year end seasonal fluctuation in banking system liquidity.
The aggregate loan-to-fund ratio remained largely stable at 82.4% (November: 82.2%), supported by sound growth in deposits of 5.9% (November: 5.9%).
Asset quality in the banking system remained intact
Overall gross and net impaired loans ratios remained broadly unchanged at 1.7% (November: 1.8%) and 1.1% (November: 1.1%), respectively.
Loan loss coverage ratio (including regulatory reserves) continued to record a prudent level of 118.2% of impaired loans, with total provisions accounting for 1.7% of total loans.
Monthly Highlights [PDF]
[1] Core inflation is computed by excluding price-volatile and price-administered items. It also excludes the estimated direct impact of tax policy changes.
[2] Comprises loans to households and non-financial corporations by the banking system and development financial institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers). Starting with the publication of December 2022 Monthly Highlights and Statistics (MHS), this series is introduced to enhance the quality of financing data. This new data series is available in the MHS Table 2.18.
[3] Regional countries comprise Singapore, Thailand, Philippines, Indonesia and Korea.
Related Assets
Monthly Highlights & Statistics in December 2022
Bank Negara Malaysia
31 January 2023
© Bank Negara Malaysia, 2023. All rights reserved.
|
Monthly Highlights May 2023
Monthly Highlights
Headline inflation declined further to 2.8% in May
May 2023
Contribution to Inflation
ppt. contribution %, yoy
1 Core inflation is computed by excluding price-volatile and price-administered items.
Source: Department of Statistics, Malaysia & Bank Negara Malaysia estimates
• Headline inflation moderated to 2.8% (April 2023:
3.3%). This decline was largely due to non-core
CPI components, particularly lower inflation for
fuel (-0.2 percentage points, ppt) and fresh food
(-0.1ppt).
• Core inflation also declined slightly to 3.5% (April
2023: 3.6%) amid lower inflation for
communication services.
3.3
2.8
3.6 3.5
0.00
2.00
4.00
0.0
2.0
4.0
J
a
n
-2
2
F
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b
-2
2
M
a
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2
2
A
p
r-
2
2
M
a
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-2
2
J
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-2
2
J
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l-
2
2
A
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-2
2
S
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-2
2
O
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t-
2
2
N
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-2
2
D
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-2
2
J
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-2
3
F
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b
-2
3
M
a
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2
3
A
p
r-
2
3
M
a
y
-2
3
Food & non-alcohol (29.5%) Housing & utilities (23.8%)
Transport (14.6%) Others (32.1%)
Headline inflation (RHS) Core inflation¹ (RHS)
1.6
5.1
4.6
0
1
2
3
4
5
6
7
May-22 Sep-22 Jan-23 May-23
Business loans
Household loans
Corporate bonds
Annual growth (%)
Credit to the Private Non-Financial Sector1,2
1
Growth in credit to the private non-financial sector improved in May
1 Comprises loans to households and non-financial corporations from the
banking system and development financial institutions (DFIs), and corporate
bonds issued by non-financial corporations (including short-term papers).
2 Starting with the publication of December 2022 Monthly Highlights and
Statistics (MHS), this series was introduced to enhance the quality of
financing data. This new data series is available in the MHS Table 2.18.
Source: Bank Negara Malaysia
Contribution to growth (ppt)
• Credit to the private non-financial sector expanded
by 4.0% as at end-May (April 2023: 3.7%), driven
mainly by higher growth in credit to businesses
(2.8%; April 2023: 2.5%).
• Outstanding corporate bonds grew by 4.6% (April
2023: 4.4%), while outstanding business loans
expanded by 1.6% (April 2023: 1.0%). The higher
business loan growth reflected improvement in
loans for both working capital and investments to
SMEs and non-SMEs.
• In the household segment, outstanding loan
growth was sustained at 5.1% (April 2023: 5.0%),
supported by higher growth across most loan
purposes. Of note, household loan growth
continued to be driven by loans for the purchase of
houses and cars, which grew by 7.0% and 8.4%,
respectively (April 2023: 6.8% and 8.0%).
2.7 2.6 2.5 2.6
0.7 0.7 0.3 0.5
1.1 0.9
0.9 1.0
4.5 4.2
3.7 4.0
Feb-23 Mar-23 Apr-23 May-23
Corporate Bonds
Business Loans
Household Loans
Credit to the Private Non-
Financial Sector
Index of wholesale and retail trade growth moderated in April
Source: Department of Statistics, Malaysia
• The Index of Wholesale and Retail Trade
(IOWRT) expanded more moderately by 4.7% in
April 2023 (March 2023: 9.4%). The lower growth
was due mainly to the decline in the motor vehicle
segment.
• However, the retail segment continued to record a
double-digit growth of 10.0% (March 2023:
13.8%), supported by sales in non-specialised and
other specialised stores1.
• On a month-on-month seasonally adjusted basis,
the index increased at a faster pace of 6.5%
(March 2023: -0.9%).
1 Other goods in specialised stores includes clothing, footwear,
pharmaceuticals, cosmetics, watches, jewellery and optical goods.
10.6
9.4
4.7
-2
3
8
13
18
23
28
33
Apr-22 Jun-22 Aug-22 Oct-22 Dec-22 Feb-23 Apr-23
ppt, %yoy
Motor vehicles Retail Wholesale
Index of Wholesale and Retail Trade
Monthly Highlights
2
May 2023
Domestic financial markets were largely affected by external factors
Financial Market Performance in May 2023
-18.0
-0.5
-1.1
-3.0
-2.0
-3.4
10-year MGS
(bps, mom)
Equity
(%, mom)
Ringgit
(%, mom)
-20 -15 -10 -5 0
May-23 Apr-23
Note: The exchange rate data is the noon-rate in the Kuala Lumpur Interbank Foreign Exchange Market
1Regional countries comprise Singapore, Thailand, Philippines, Indonesia, and Korea
Source: Bank Negara Malaysia, Bursa Malaysia
• Global investors maintained a risk-off approach
throughout May, as concerns over the impact of the
US debt ceiling crisis and the weaker-than-
expected rebound in China’s economy weighed on
global financial markets.
• As a result, the ringgit depreciated against the US
dollar by 3.4% (regional1 average: -1.2%). Similarly,
the FBM KLCI declined by 2.0% (regional1 average:
-1.3%).
• Nonetheless, the 10-year MGS yields decreased
slightly by 3 basis points, supported by non-resident
inflows into the domestic bond market.
Banks maintained strong liquidity and funding positions to support intermediation
• Banks continued to record healthy liquidity buffers
with the aggregate Liquidity Coverage Ratio at
151.2% (April 2023: 154.3%).
• The aggregate loan-to-fund ratio remained stable at
81.8% (April 2023: 82.1%).
Source: Bank Negara Malaysia
Banking System Liquidity and Funding Ratios
81.8
151.2
0
40
80
120
160
70
75
80
85
90
95
M
a
y
2
2
J
u
n
2
2
J
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2
2
A
u
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2
2
S
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p
2
2
O
c
t
2
2
N
o
v
2
2
D
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c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
A
p
r
2
3
M
a
y
2
3
% %
Liquidity Coverage Ratio (RHS)
Loan-to-Fund Ratio
Asset quality in the banking system remained intact
Banking System Asset Quality
Source: Bank Negara Malaysia
• Overall gross and net impaired loans ratios
remained broadly unchanged at 1.80% (April
2023: 1.78%) and 1.10% (April 2023: 1.10%),
respectively.
• Loan loss coverage ratio (including regulatory
reserves) remained at a prudent level of 114.1%
of impaired loans, with total provisions accounting
for 1.7% of total loans.
%
1.8
1.1
1.7
0.5
1.0
1.5
2.0
M
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2
2
J
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2
2
J
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2
A
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2
2
S
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2
2
O
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2
2
N
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D
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2
2
J
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3
F
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2
3
M
a
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2
3
A
p
r
2
3
M
a
y
2
3
Gross Impaired Loans Ratio
Total Provisions to Total Loans Ratio
Net Impaired Loans Ratio
April 2023 Monthly Highlights
Slide 1
Slide 2
| Press Release |
31 Jan 2023 | Detailed Disclosure of International Reserves as at end-December 2022 | https://www.bnm.gov.my/-/detailed-disclosure-of-international-reserves-as-at-end-december-2022 | null | null |
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Detailed Disclosure of International Reserves as at end-December 2022
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Detailed Disclosure of International Reserves as at end-December 2022
Embargo :
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1200 on
Tuesday, 31 January 2023
31 Jan 2023
In accordance with the International Monetary Fund (IMF) Special Data Dissemination Standard (SDDS) format, the detailed breakdown of international reserves provides forward-looking information on the size, composition and usability of reserves and other foreign currency assets, and the expected and potential future inflows and outflows of foreign exchange of the Federal Government and Bank Negara Malaysia over the next 12-month period.
The detailed breakdown of international reserves based on the SDDS format is shown in Tables I, II, III and IV.
As shown in Table I, official reserve assets amounted to USD114,653.9 million, while other foreign currency assets amounted to USD5.4 million as at end-December 2022.
As shown in Table II, for the next 12 months, the pre-determined short-term outflows of foreign currency loans, securities and deposits, which include among others, scheduled repayment of external borrowings by the Government and the maturity of foreign currency Bank Negara Interbank Bills, amounted to USD16,939.4 million. The short forward positions amounted to USD26,390.6 million as at end-December 2022, reflecting the management of ringgit liquidity in the money market. In line with the practice adopted since April 2006, the data excludes projected foreign currency inflows arising from interest income and the drawdown of project loans. Projected foreign currency inflows amount to USD2,252.9 million in the next 12 months.
As shown in Table III, the only contingent short-term net drain on foreign currency assets is Government guarantees of foreign currency debt due within one year, amounting to USD378.5 million. There are no foreign currency loans with embedded options, and no undrawn, unconditional credit lines provided by or to other central banks, international organisations, banks and other financial institutions. Bank Negara Malaysia also does not engage in foreign currency options vis-à-vis ringgit.
Overall, the detailed breakdown of international reserves under the IMF SDDS format indicates that as at end-December 2022, Malaysia’s international reserves remain usable. Related Assets
International Reserves and Foreign Currency Liquidity (31 December 2022)
Bank Negara Malaysia
31 January 2023
© Bank Negara Malaysia, 2023. All rights reserved.
| null | Press Release |
25 Jan 2023 | Appointment of Members of the Shariah Advisory Council of Bank Negara Malaysia | https://www.bnm.gov.my/-/reappointment-sacbnm-members-2023 | null | null |
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Appointment of Members of the Shariah Advisory Council of Bank Negara Malaysia
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Appointment of Members of the Shariah Advisory Council of Bank Negara Malaysia
Embargo :
For immediate release
Not for publication or broadcast before
1734 on
Wednesday, 25 January 2023
25 Jan 2023
Bank Negara Malaysia wishes to announce the reappointment of four Shariah Advisory Council (SAC) members for a three-year term and the appointment of two new SAC members for a two-year term, with effect from 1 January 2023. These appointments are in accordance with section 53(1) of the Central Bank of Malaysia Act 2009.
The SAC comprises nine members with expertise and experience in Shariah, Islamic economics, law and finance.
The reappointed members are:
Prof. Dr. Ashraf Md Hashim
Professor, INCEIF University and the new Chairman of SAC
Prof. Dr. Engku Rabiah Adawiah Engku Ali
Professor, Institute of Islamic Banking and Finance, International Islamic University Malaysia and the new Deputy Chairman of SAC
Datuk Prof. Dr. Mohamad Akram Laldin
Executive Director, ISRA Research Management Centre, INCEIF University
Encik Burhanuddin Lukman
Member, Hajj Advisory Committee, Lembaga Tabung Haji
The newly appointed members are:
Datuk Seri Mohd Zawawi Salleh
Former Judge of the Federal Court
Dr. Ahmad Basri Ibrahim
Head, Shariah Management, Permodalan Nasional Berhad
The other existing members are:
Sahibus Samahah Dato’ Setia Dr. Haji Anhar Haji Opir
Mufti of Selangor
Dr. Marjan Muhammad
Director, Research Quality Assurance and Publications, ISRA Research Management Centre, INCEIF University
Encik Zainal Abidin Jamal
Founder and Senior Partner, Zainal Abidin & Co. (Advocates and Solicitors)
The SAC is the highest authority for the ascertainment of Islamic law for purposes of Islamic financial business in Malaysia. It is central in promoting Shariah certainty and sustaining public confidence in the Islamic finance industry. The SAC also advises the Bank on Shariah issues relating to Islamic financial businesses, activities or transactions of the Bank. The rulings of the SAC serve as a reference for Islamic financial institutions in ensuring their business operations comply with Shariah principles. The rulings may also serve as a reference for the courts and arbitrators. The SAC convened its first meeting for the year 2023 today.
The Bank also wishes to express appreciation to Tan Sri Dr. Mohd Daud Bakar and Dato’ A. Aziz A. Rahim, who completed their service on the SAC. Tan Sri Dr. Mohd Daud Bakar was appointed to the SAC on 1 May 1997 and assumed position as Chairman of the SAC since 27 December 2006. Meanwhile, Dato’ A. Aziz A. Rahim was first appointed to the SAC on 1 November 2016.
Bank Negara Malaysia Governor Tan Sri Nor Shamsiah Mohd Yunus said, “The SAC plays a pivotal role in advancing Malaysia’s Islamic finance aspirations. Over the years, Tan Sri Dr. Mohd Daud Bakar and Dato’ A. Aziz A. Rahim made significant contributions in that journey, and I would like to express my deepest thanks for their unwavering commitment and dedication.”
Bank Negara Malaysia
25 January 2023
© Bank Negara Malaysia, 2023. All rights reserved.
| null | Press Release |
20 Jan 2023 | International Reserves of Bank Negara Malaysia as at 13 January 2023 | https://www.bnm.gov.my/-/international-reserves-of-bank-negara-malaysia-as-at-13-january-2023 | https://www.bnm.gov.my/documents/20124/6118085/qb2021q4_en_box_imports.pdf | null |
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International Reserves of Bank Negara Malaysia as at 13 January 2023
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International Reserves of Bank Negara Malaysia as at 13 January 2023
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Friday, 20 January 2023
20 Jan 2023
The international reserves of Bank Negara Malaysia amounted to USD114.9 billion as at 13 January 2023. The reserves position is sufficient to finance 5.3 months of imports of goods and services[1], and is 1.0 time of the total short-term external debt.
[1] Under the previous import coverage measure, reserves is sufficient to finance 6.2 months of retained imports of goods. For more information on the new indicator, please refer to the article on “Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to Imports of Goods and Services” in BNM’s Quarterly Bulletin for the Fourth Quarter of 2021 publication, page 27, which can be accessed at bnm.gov.my/-/quarterly-bulletin-4q-2021 Related Assets
BNM Statement of Assets & Liabilities - 13 January 2023
Bank Negara Malaysia
20 January 2023
© Bank Negara Malaysia, 2023. All rights reserved.
|
Monthly Highlights
Headline inflation declined to 3.4% in March
March 2023
1
3.7 3.4
3.9 3.8
0.00
2.00
4.00
0.0
2.0
4.0
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3
Food & non-alcohol (29.5%) Housing & utilities (23.8%)
Transport (14.6%) Others (32.1%)
Headline inflation (RHS) Core inflation¹ (RHS)
Contribution to Inflation
ppt. contribution %, yoy
1 Core inflation is computed by excluding price-volatile and price-administered items.
Source: Department of Statistics, Malaysia & Bank Negara Malaysia estimates
• Headline inflation declined to 3.4% in March
(February: 3.7%) due mainly to lower inflation for
fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation moderated slightly to 3.8% during
the month (February: 3.9%), driven largely by
lower inflation for food away from home.
1
Robust growth in volume index driven by retail and motor vehicles
Index of Wholesale and Retail Trade
Source: Department of Statistics, Malaysia
• The Index of Wholesale and Retail Trade
(IOWRT) expanded by 10.6% in February 2023
(January: 8.5%).
• The higher growth was driven mainly by retail
sales in non-specialised stores (e.g., department
stores) followed by continued strength in
purchases of motor vehicles amid the ongoing
fulfilment of backlog orders.
• On a month-on-month seasonally adjusted basis,
the index accelerated by 5.5% (January: 0.2%).
9.5 8.510.6
0
10
20
30
40
Feb-
22
Mar-
22
Apr-
22
May-
22
Jun-
22
Jul-
22
Aug-
22
Sep-
22
Oct-
22
Nov-
22
Dec-
22
Jan-
23
Feb-
23
ppt, %yoy
Motor vehicles Retail Wholesale
2.4
5.2
4.4
0
1
2
3
4
5
6
7
Mar-22 Jul-22 Nov-22 Mar-23
Business loans
Household loans
Corporate bonds
Annual growth (%)
Growth in credit to the private non-financial sector moderated
1 Comprises loans to households and non-financial corporations from the
banking system and development financial institutions (DFIs), and corporate
bonds issued by non-financial corporations (including short-term papers).
2 Starting with the publication of December 2022 Monthly Highlights and
Statistics (MHS), this series was introduced to enhance the quality of
financing data. This new data series is available in the MHS Table 2.18.
Source: Bank Negara Malaysia
2.7 2.6 2.7 2.6
1.0 0.6 0.7 0.7
1.0
1.1 1.1 0.9
4.7 4.3 4.5 4.2
Dec-22 Jan-23 Feb-23 Mar-23
Corporate Bonds
Business Loans
Household Loans
Credit to the Private Non-
Financial Sector
Contribution to growth (ppt)
• Credit to the private non-financial sector grew by
4.2% as at end-March (February: 4.5%), attributed
to slower growth in credit to businesses (3.2%;
February: 3.7%).
• While growth in outstanding corporate bonds
moderated (4.4%; February : 5.5%), outstanding
business loan growth was sustained at 2.4%
(February: 2.4%). This was supported by the
continued growth in both working capital (2.2%;
February: 1.9%) and investment-related loans
(4.3%; February: 4.2%).
• Outstanding household loan growth remained
broadly stable (5.2%; February: 5.3%), supported
by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan
growth for the purchase of securities (-6.9%;
February: -3.3%).
Credit to the Private Non-Financial Sector1,2
Monthly Highlights
March 2023
Domestic financial market conditions remained orderly
Financial Market Performance in March 2023
Source: Bank Negara Malaysia, Bursa Malaysia
Note: The exchange rate data is the noon-rate in the Kuala Lumpur Interbank Foreign Exchange Market
11.0
-2.1
-5.3
0.0
-2.2
1.7
10-year MGS
(bps, mom)
Equity
(%, mom)
Ringgit
(%, mom)
-10 -5 0 5 10 15
Mar-23
Feb-23
• In March, global financial markets were affected by
the emergence of banking sector stress in some
major economies. As spillovers were contained thus
far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds
improved.
• In line with the performance of regional currencies,
the ringgit appreciated by 1.7% against the US
dollar. Conditions in the domestic bond market
also remained stable.
• The FBM KLCI declined by 2.2% during the month.
2
Banks maintained strong liquidity and funding positions to support intermediation
Source: Bank Negara Malaysia
Banking System Liquidity and Funding Ratios
81.9
157.4
0
40
80
120
160
70
75
80
85
90
95
M
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M
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2
3
% %
Liquidity Coverage Ratio (RHS)
Loan-to-Fund Ratio
Asset quality in the banking system remained intact
Banking System Asset Quality
Source: Bank Negara Malaysia
• Overall gross and net impaired loans ratios
increased slightly to 1.8% (February-23: 1.8%) and
1.2% (February-23: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory
reserves) continue to record a prudent level of
110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
%
1.8
1.2
1.7
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
M
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2
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M
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3
M
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2
3
Gross Impaired Loans Ratio
Total Provisions to Total Loans Ratio
Net Impaired Loans Ratio
• Banks continued to record healthy liquidity buffers
with the aggregate Liquidity Coverage Ratio at
157.4% (February-23: 152.7%).
• The aggregate loan-to-fund ratio remained stable at
81.9% (February-23: 81.6%).
PRESS RELEASE
Ref. No.: 04/23/05 EMBARGO: Not for publication or
broadcast before 1500 hours on
Friday, 28 April 2023
Monthly Highlights – March 2023
Headline inflation declined to 3.4% in March
• Headline inflation declined to 3.4% in March (February: 3.7%) due mainly
to lower inflation for fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation1 moderated slightly to 3.8% during the month
(February: 3.9%), driven largely by lower inflation for food away from
home.
Robust growth in volume index driven by retail and motor vehicles
• The Index of Wholesale and Retail Trade (IOWRT) expanded by 10.6%
in February 2023 (January: 8.5%).
• The higher growth was driven mainly by retail sales in non-specialised
stores (e.g., department stores) followed by continued strength in
purchases of motor vehicles amid the ongoing fulfilment of backlog
orders.
• On a month-on-month seasonally adjusted basis, the index accelerated
by 5.5% (January: 0.2%).
1 Core inflation is computed by excluding price-volatile and price-administered items.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Growth in credit to the private non-financial sector2,3 moderated
• Credit to the private non-financial sector grew by 4.2% as at end-March
(February: 4.5%), attributed to slower growth in credit to businesses
(3.2%; February: 3.7%).
• While growth in outstanding corporate bonds moderated (4.4%;
February: 5.5%), outstanding business loan growth was sustained at
2.4% (February: 2.4%). This was supported by the continued growth in
both working capital (2.2%; February: 1.9%) and investment-related
loans (4.3%; February: 4.2%).
• Outstanding household loan growth remained broadly stable (5.2%;
February: 5.3%), supported by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan growth for the purchase of
securities (-6.9%; February: -3.3%).
Domestic financial market conditions remained orderly
• In March, global financial markets were affected by the emergence of
banking sector stress in some major economies. As spillovers were
contained thus far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds improved.
• In line with the performance of regional currencies, the ringgit
appreciated by 1.7% against the US dollar. Conditions in the domestic
bond market also remained stable.
• The FBM KLCI declined by 2.2% during the month.
Banks maintained strong liquidity and funding positions to support
intermediation
• Banks continued to record healthy liquidity buffers with the aggregate
Liquidity Coverage Ratio at 157.4% (February: 152.7%).
2 Comprises loans to households and non-financial corporations from the banking system and development financial
institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers).
3 Starting with the publication of December 2022 Monthly Highlights and Statistics (MHS), this series was introduced
to enhance the quality of financing data. This new data series is available in the MHS Table 2.18.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
• The aggregate loan-to-fund ratio remained stable at 81.9%
(February: 81.6%).
Asset quality in the banking system remained intact
• Overall gross and net impaired loans ratios increased slightly to 1.8%
(February: 1.8%) and 1.2% (February: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory reserves) continues to
record a prudent level of 110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
Bank Negara Malaysia
28 April 2023
20230428_BNM Monthly Highlights-March_en
Slide 1
Slide 2
20230428_BNM PR_Monthly Highlights-Mar 2023_eng
| Press Release |
19 Jan 2023 | Monetary Policy Statement | https://www.bnm.gov.my/-/monetary-policy-statement-19012023 | https://www.bnm.gov.my/documents/20124/9503233/MPS_Snapshot_2023_01_en.pdf | null |
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Monetary Policy Statement
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Monetary Policy Statement
Embargo :
For immediate release
Not for publication or broadcast before
1500 on
Thursday, 19 January 2023
19 Jan 2023
At its meeting today, the Monetary Policy Committee (MPC) of Bank Negara Malaysia decided to maintain the Overnight Policy Rate (OPR) at 2.75 percent.
The global economy continues to be weighed down by elevated cost pressures, higher interest rates, and COVID-19-related disruptions in China. These factors more than offset the support from positive labour market conditions, and the full reopening of economies and international borders. Headline inflation moderated slightly from high levels in recent months. However, core inflation remains above historical averages. Central banks are expected to continue raising interest rates, albeit at a slower pace, to manage inflationary pressures. This will continue to pose headwinds to the global growth outlook. On the other hand, growth in China is expected to improve once the current COVID-19 wave subsides. The growth outlook remains subject to downside risks, including an escalation of geopolitical tensions, weaker-than-expected growth outturns in major economies, and a sharp tightening in financial market conditions.
For Malaysia, the latest data indicated continued economic expansion in the final quarter of last year on account of resilient domestic demand. As a result, growth for 2022 is expected to exceed the earlier projected range of 6.5% - 7.0%. Coming off a strong performance in 2022, growth in 2023 is expected to moderate amid a slower global economy. Growth will remain supported by domestic demand. Household spending will be underpinned by sustained improvements in employment and income prospects. Tourist arrivals have continued to rise, further lifting the tourism-related sectors. The realisation of multi-year infrastructure projects will support investment activity. Downside risks to the domestic economy continue to stem from a weaker-than-expected global growth, higher risk aversion in global financial markets amid more aggressive monetary policy tightening in major economies, further escalation of geopolitical conflicts, and re-emergence of significant supply chain disruptions.
Headline inflation has averaged 3.4% for the period January-November 2022. As projected, headline inflation peaked in 3Q 2022, while underlying inflation, as measured by core inflation, has averaged 2.9% up to November 2022. Over the course of 2023, headline and core inflation are expected to moderate but remain at elevated levels amid lingering demand and cost pressures. Existing price controls and fuel subsidies, and the remaining spare capacity in the economy, will continue to partly contain the extent of upward pressures to inflation. The balance of risk to the inflation outlook is tilted to the upside and remains highly subject to any changes to domestic policy on subsidies and price controls, as well as global commodity price developments.
Today's decision allows the MPC to assess the impact of the cumulative past OPR adjustments, given the lag effects of monetary policy on the economy. At the current OPR level, the stance of monetary policy remains accommodative and supportive of economic growth. Further normalisation to the degree of monetary policy accommodation would be informed by the evolving conditions and their implications to the domestic inflation and growth outlook. The MPC will continue to calibrate the monetary policy settings that balance the risks to domestic inflation and sustainable growth.
See also:
Monetary Policy Statement (MPS) Snapshot: Jan 2023
Frequently Asked QuestionsBank Negara Malaysia
19 January 2023
© Bank Negara Malaysia, 2023. All rights reserved.
|
Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to Imports of Goods and Services
27Quarterly Bulletin | 4Q 2021
Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to
Imports of Goods and Services
One of the indicators used by the Bank to measure international reserve adequacy is the reserve coverage
of retained imports,1 which is communicated on a fortnightly basis. As the economy grew and evolved with
higher share of the services sector, this has raised the prominence of services imports in the measure of
reserve adequacy. Given this consideration and in line with the international best practice, future fortnightly
reporting of Malaysia’s international reserves will include the indicator on reserve coverage of imports of
goods and services, effective from 22 February 2022.2
1 Defined as gross imports subtracted with re-exports. The 12-month average retained imports can be derived from the Monthly Highlight and Statistics Table
3.6.8 (Imports by End-Use; see Appendix 1).
2 For the international reserves position as at 15 February 2022.
3 Defined as imports plus exports.
4 From RM101.3 billion to RM351.3 billion, or a compound annual growth rate (CAGR) of 6.4%.
5 Based on JP Morgan’s Government Bond Index for Emerging Markets.
Services tradeC1
0
100
200
300
400
1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021
RM billion
Travel1
Computer and information
Transport
Manufacturing
Other business3
Other2
Perdagangan perkhidmatanR1
0
100
200
300
400
1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021
RM bilion
Perjalanan1
Komputer dan informasi
Pengangkutan
Pembuatan
Perniagaan Lain3
Lain-lain2
Nota: Data sebelum tahun 2005 adalah berdasarkan garis panduan dalam Edisi Kelima Manual Imbangan Pembayaran dan Kedudukan
............Pelaburan Antarabangsa (BPM5) IMF. Data bagi tahun 2005 dan selanjutnya adalah berdasarkan BPM6.
1 Termasuk perbelanjaan perjalanan bagi aktiviti pelancongan.
2 Termasuk pembinaan, caj penggunaan harta intelek, perkhidmatan persendirian, kebudayaan dan rekreasi.
3 Perkhidmatan perniagaan lain termasuk perkhidmatan penyelidikan dan pembangunan, profesional, teknikal, berkaitan perdagangan dan
...perkhidmatan perniagaan lain.
Sumber: Jabatan Perangkaan Malaysia dan Bank Negara Malaysia
Note: Data prior to 2005 are based on the guideline in the Fifth Edition of the Balance of Payments and International Investment Position
............Manual (BPM5) of the IMF. Data for 2005 and beyond are based on BPM6.
1 Includes travel spending for tourism activity.
2 Includes construction, charges for intellectual property use, personal, culture & recreational services.
3 Other business services comprise research and development, professional, technical, trade-related and other business services.
Source: Department of Statistics, Malaysia and Bank Negara Malaysia
The Bank’s reporting of the reserve coverage of retained imports was published as early as in the 1990s. Data
on retained imports are available on monthly basis and thereby closely match the fortnightly release of the
international reserves data. However, retained imports do not include payment for services, which has grown
over the past two decades. From 1999 to 2019, services trade3 has increased by 246.9%4 (Chart 1). This was
mainly due to higher tourism activity as well as payments for foreign transport services for goods trade. In
addition, there was also an expansion in goods import, largely in support of domestic investment activities
and production of manufactured goods.
Malaysia’s performance on this indicator is in line with regional and peer5 economies. On historical basis,
reserve coverage of imports of goods and services indicator has been in the range of between 5 and 8
months since 2008 – well above the generally-accepted ‘rule of thumb’ adequacy threshold of 3-months, and
demonstrates the ability of the Malaysian economy to withstand against external shocks.
28 Quarterly Bulletin | 4Q 2021
It is also important to emphasize that the assessment of reserve adequacy should not be solely based
on the face value of these indicators. This needs to be complemented with deeper understanding about
the country’s external position, financial system and broad economic policies. In particular, international
reserves is not the only means to meet external obligations.6 Prevailing assessment indicates that the
country’s external position7 is underpinned by its strong economic fundamentals including healthy current
account surplus, large foreign currency external assets held by domestic entities8 and the flexible ringgit
exchange rate.
References
Department of Statistics, Malaysia. ‘External Sector’, Jabatan Perangkaan Malaysia, Putrajaya.
Greenspan, A., ‘Currency reserves and debt’. Remarks before the World Bank Conference on Recent Trends in
Reserves Management, Washington, DC, 29 April 1999.
International Monetary Fund, (2016). ‘Guidance Note on the Assessment of Reserve Adequacy and Related
Considerations’.
Appendix 1: Calculation of international reserves coverage of retained imports
aFor example, to calculate monthly retained imports for December 2019, the retained imports for the months of
January to December 2019 is summed up (i.e. rolling 12-months of retained imports). This number is then divided
by 12, to obtain a monthly average. The figures can be obtained from BNM’s MHS Table 3.6.8, column S.
6 Further information can be found in the box article “Malaysia’s Resilience in Managing External Debt Obligations and the Adequacy of International Reserves”
in BNM’s Annual Report 2018.
7 In addition, it has also been emphasized that Malaysia’s external debt position, including short-term external debt, remains manageable. This is supported by
the favourable currency and maturity profile on its external debt as well as domestic entities’ resilient repayment capacity. Foreign-currency external debt of
corporates are also mainly subject to prudential and hedging requirements (refer to the latest assessment on external debt developments on page 25)
8 Amounting to RM1.1 trillion as at end-2021.
| Press Release |
13 Jan 2023 | Reappointment of External Member to BNM's Monetary Policy Committee | https://www.bnm.gov.my/-/mpc-mbr-reappt-2023 | null | null |
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Reappointment of External Member to BNM's Monetary Policy Committee
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Reappointment of External Member to BNM's Monetary Policy Committee
Embargo :
For immediate release
Not for publication or broadcast before
1800 on
Friday, 13 January 2023
13 Jan 2023
Bank Negara Malaysia wishes to announce the reappointment of Mr. Nor Zahidi Alias as an external member of the Monetary Policy Committee (MPC). The reappointment is for a three-year term, effective 1 January 2023.Mr. Nor Zahidi AliasMr. Nor Zahidi Alias has been an external member of the MPC since 1 January 2021. He was the Chief Economist of the Malaysian Rating Corporation Berhad (MARC). Earlier in his career, he worked at The New Straits Times Press (M) Berhad as a senior analyst before subsequently joining Kuala Lumpur City Securities as an economist. Prior to his position in MARC, he was the Head of Research and Chief Economist of Alliance Merchant Bank and Head of Research of MCIS Zurich Insurance. Mr. Nor Zahidi holds a Master’s degree in Economics Policy and a Bachelor’s degree in Economics from Boston University.
About the MPC
Under the Central Bank of Malaysia Act 2009 (CBA), the MPC is responsible for formulating monetary policy and deciding on policies for the conduct of monetary policy operations. The CBA also sets out the process for appointing members to the MPC.
Members of the MPC
(1) Governor Nor Shamsiah Mohd Yunus
(2) Deputy Governor Abdul Rasheed Ghaffour
(3) Deputy Governor Jessica Chew Cheng Lian
(4) Deputy Governor Marzunisham Omar
(5) Assistant Governor Adnan Zaylani Mohamad Zahid
(6) Assistant Governor Dr. Norhana Endut
(7) Assistant Governor Fraziali Ismail
(8) Lim Chee Sing
(9) Nor Zahidi Alias
See also:
Profiles of BNM Monetary Policy Committee members
Role of BNM in promoting Monetary StabilityBank Negara Malaysia
13 January 2023
© Bank Negara Malaysia, 2023. All rights reserved.
| null | Press Release |
09 Jan 2023 | International Reserves of Bank Negara Malaysia as at 30 December 2022 | https://www.bnm.gov.my/-/international-reserves-of-bank-negara-malaysia-as-at-30-december-2022 | https://www.bnm.gov.my/documents/20124/6118085/qb2021q4_en_box_imports.pdf | null |
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International Reserves of Bank Negara Malaysia as at 30 December 2022
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International Reserves of Bank Negara Malaysia as at 30 December 2022
Embargo :
For immediate release
Not for publication or broadcast before
1500 on
Monday, 9 January 2023
9 Jan 2023
The international reserves of Bank Negara Malaysia amounted to USD114.6 billion as at 30 December 2022. The reserves level has taken into account the quarterly foreign exchange revaluation changes. The reserves position is sufficient to finance 5.2 months of imports of goods and services[1], and is 1.0 time of the total short-term external debt.
[1] Under the previous import coverage measure, reserves are sufficient to finance 6.2 months of retained imports of goods. For more information on the new indicator, please refer to the article on “Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to Imports of Goods and Services” in BNM’s Quarterly Bulletin for the Fourth Quarter of 2021 publication, page 27, which can be accessed at Quarterly Bulletin 4Q 2021. Related Assets
BNM Statement of Assets & Liabilities - 30 December 2022
Bank Negara Malaysia
9 January 2023
© Bank Negara Malaysia, 2023. All rights reserved.
|
Monthly Highlights
Headline inflation declined to 3.4% in March
March 2023
1
3.7 3.4
3.9 3.8
0.00
2.00
4.00
0.0
2.0
4.0
J
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-2
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M
a
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3
Food & non-alcohol (29.5%) Housing & utilities (23.8%)
Transport (14.6%) Others (32.1%)
Headline inflation (RHS) Core inflation¹ (RHS)
Contribution to Inflation
ppt. contribution %, yoy
1 Core inflation is computed by excluding price-volatile and price-administered items.
Source: Department of Statistics, Malaysia & Bank Negara Malaysia estimates
• Headline inflation declined to 3.4% in March
(February: 3.7%) due mainly to lower inflation for
fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation moderated slightly to 3.8% during
the month (February: 3.9%), driven largely by
lower inflation for food away from home.
1
Robust growth in volume index driven by retail and motor vehicles
Index of Wholesale and Retail Trade
Source: Department of Statistics, Malaysia
• The Index of Wholesale and Retail Trade
(IOWRT) expanded by 10.6% in February 2023
(January: 8.5%).
• The higher growth was driven mainly by retail
sales in non-specialised stores (e.g., department
stores) followed by continued strength in
purchases of motor vehicles amid the ongoing
fulfilment of backlog orders.
• On a month-on-month seasonally adjusted basis,
the index accelerated by 5.5% (January: 0.2%).
9.5 8.510.6
0
10
20
30
40
Feb-
22
Mar-
22
Apr-
22
May-
22
Jun-
22
Jul-
22
Aug-
22
Sep-
22
Oct-
22
Nov-
22
Dec-
22
Jan-
23
Feb-
23
ppt, %yoy
Motor vehicles Retail Wholesale
2.4
5.2
4.4
0
1
2
3
4
5
6
7
Mar-22 Jul-22 Nov-22 Mar-23
Business loans
Household loans
Corporate bonds
Annual growth (%)
Growth in credit to the private non-financial sector moderated
1 Comprises loans to households and non-financial corporations from the
banking system and development financial institutions (DFIs), and corporate
bonds issued by non-financial corporations (including short-term papers).
2 Starting with the publication of December 2022 Monthly Highlights and
Statistics (MHS), this series was introduced to enhance the quality of
financing data. This new data series is available in the MHS Table 2.18.
Source: Bank Negara Malaysia
2.7 2.6 2.7 2.6
1.0 0.6 0.7 0.7
1.0
1.1 1.1 0.9
4.7 4.3 4.5 4.2
Dec-22 Jan-23 Feb-23 Mar-23
Corporate Bonds
Business Loans
Household Loans
Credit to the Private Non-
Financial Sector
Contribution to growth (ppt)
• Credit to the private non-financial sector grew by
4.2% as at end-March (February: 4.5%), attributed
to slower growth in credit to businesses (3.2%;
February: 3.7%).
• While growth in outstanding corporate bonds
moderated (4.4%; February : 5.5%), outstanding
business loan growth was sustained at 2.4%
(February: 2.4%). This was supported by the
continued growth in both working capital (2.2%;
February: 1.9%) and investment-related loans
(4.3%; February: 4.2%).
• Outstanding household loan growth remained
broadly stable (5.2%; February: 5.3%), supported
by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan
growth for the purchase of securities (-6.9%;
February: -3.3%).
Credit to the Private Non-Financial Sector1,2
Monthly Highlights
March 2023
Domestic financial market conditions remained orderly
Financial Market Performance in March 2023
Source: Bank Negara Malaysia, Bursa Malaysia
Note: The exchange rate data is the noon-rate in the Kuala Lumpur Interbank Foreign Exchange Market
11.0
-2.1
-5.3
0.0
-2.2
1.7
10-year MGS
(bps, mom)
Equity
(%, mom)
Ringgit
(%, mom)
-10 -5 0 5 10 15
Mar-23
Feb-23
• In March, global financial markets were affected by
the emergence of banking sector stress in some
major economies. As spillovers were contained thus
far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds
improved.
• In line with the performance of regional currencies,
the ringgit appreciated by 1.7% against the US
dollar. Conditions in the domestic bond market
also remained stable.
• The FBM KLCI declined by 2.2% during the month.
2
Banks maintained strong liquidity and funding positions to support intermediation
Source: Bank Negara Malaysia
Banking System Liquidity and Funding Ratios
81.9
157.4
0
40
80
120
160
70
75
80
85
90
95
M
a
r
2
2
A
p
r
2
2
M
a
y
2
2
J
u
n
2
2
J
u
l
2
2
A
u
g
2
2
S
e
p
2
2
O
c
t
2
2
N
o
v
2
2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
% %
Liquidity Coverage Ratio (RHS)
Loan-to-Fund Ratio
Asset quality in the banking system remained intact
Banking System Asset Quality
Source: Bank Negara Malaysia
• Overall gross and net impaired loans ratios
increased slightly to 1.8% (February-23: 1.8%) and
1.2% (February-23: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory
reserves) continue to record a prudent level of
110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
%
1.8
1.2
1.7
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
M
a
r
2
2
A
p
r
2
2
M
a
y
2
2
J
u
n
2
2
J
u
l
2
2
A
u
g
2
2
S
e
p
2
2
O
c
t
2
2
N
o
v
2
2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
Gross Impaired Loans Ratio
Total Provisions to Total Loans Ratio
Net Impaired Loans Ratio
• Banks continued to record healthy liquidity buffers
with the aggregate Liquidity Coverage Ratio at
157.4% (February-23: 152.7%).
• The aggregate loan-to-fund ratio remained stable at
81.9% (February-23: 81.6%).
PRESS RELEASE
Ref. No.: 04/23/05 EMBARGO: Not for publication or
broadcast before 1500 hours on
Friday, 28 April 2023
Monthly Highlights – March 2023
Headline inflation declined to 3.4% in March
• Headline inflation declined to 3.4% in March (February: 3.7%) due mainly
to lower inflation for fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation1 moderated slightly to 3.8% during the month
(February: 3.9%), driven largely by lower inflation for food away from
home.
Robust growth in volume index driven by retail and motor vehicles
• The Index of Wholesale and Retail Trade (IOWRT) expanded by 10.6%
in February 2023 (January: 8.5%).
• The higher growth was driven mainly by retail sales in non-specialised
stores (e.g., department stores) followed by continued strength in
purchases of motor vehicles amid the ongoing fulfilment of backlog
orders.
• On a month-on-month seasonally adjusted basis, the index accelerated
by 5.5% (January: 0.2%).
1 Core inflation is computed by excluding price-volatile and price-administered items.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Growth in credit to the private non-financial sector2,3 moderated
• Credit to the private non-financial sector grew by 4.2% as at end-March
(February: 4.5%), attributed to slower growth in credit to businesses
(3.2%; February: 3.7%).
• While growth in outstanding corporate bonds moderated (4.4%;
February: 5.5%), outstanding business loan growth was sustained at
2.4% (February: 2.4%). This was supported by the continued growth in
both working capital (2.2%; February: 1.9%) and investment-related
loans (4.3%; February: 4.2%).
• Outstanding household loan growth remained broadly stable (5.2%;
February: 5.3%), supported by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan growth for the purchase of
securities (-6.9%; February: -3.3%).
Domestic financial market conditions remained orderly
• In March, global financial markets were affected by the emergence of
banking sector stress in some major economies. As spillovers were
contained thus far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds improved.
• In line with the performance of regional currencies, the ringgit
appreciated by 1.7% against the US dollar. Conditions in the domestic
bond market also remained stable.
• The FBM KLCI declined by 2.2% during the month.
Banks maintained strong liquidity and funding positions to support
intermediation
• Banks continued to record healthy liquidity buffers with the aggregate
Liquidity Coverage Ratio at 157.4% (February: 152.7%).
2 Comprises loans to households and non-financial corporations from the banking system and development financial
institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers).
3 Starting with the publication of December 2022 Monthly Highlights and Statistics (MHS), this series was introduced
to enhance the quality of financing data. This new data series is available in the MHS Table 2.18.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
• The aggregate loan-to-fund ratio remained stable at 81.9%
(February: 81.6%).
Asset quality in the banking system remained intact
• Overall gross and net impaired loans ratios increased slightly to 1.8%
(February: 1.8%) and 1.2% (February: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory reserves) continues to
record a prudent level of 110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
Bank Negara Malaysia
28 April 2023
20230428_BNM Monthly Highlights-March_en
Slide 1
Slide 2
20230428_BNM PR_Monthly Highlights-Mar 2023_eng
| Press Release |
15 Apr 2024 | Financial Markets to Remain Orderly | https://www.bnm.gov.my/-/fm154 | null | null |
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Financial Markets to Remain Orderly
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Financial Markets to Remain Orderly
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0641 on
Monday, 15 April 2024
15 Apr 2024
Following the statement by YAB Prime Minister on 14 April 2024, Bank Negara Malaysia (BNM) wishes to state that BNM stands ready to deploy the tools at our disposal to ensure the Malaysian financial markets remain orderly and continue to function efficiently.
BNM’s market operations will ensure sufficient liquidity and orderly functioning of the foreign exchange market. This is supported by the ongoing initiatives with GLCs, GLICs, corporates and exporters which continue unabated to further bring in flows and liquidity into the foreign exchange market.
BNM continues to closely monitor conditions in the financial markets and will manage any risks arising from heightened financial market volatility. BNM has engaged with financial market participants, including heads of treasury operations, who concur that any uncertainties would recede and stabilise once the geopolitical situation de-escalates.
Bank Negara Malaysia
15 April 2024
© Bank Negara Malaysia, 2024. All rights reserved.
| null | Press Release |
09 Apr 2024 | Outage of Banking Services | https://www.bnm.gov.my/-/outage-banking-services-en | null | null |
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Outage of Banking Services
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Outage of Banking Services
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2232 on
Tuesday, 9 April 2024
9 Apr 2024
Bank Negara Malaysia (BNM) takes a serious view of the recent banking services outages by two of our largest banking institutions which have caused disruptions and inconvenience to customers. Both banks have since restored normal banking services. The banks have also been instructed to ensure appropriate communication with affected customers. This includes promptly attending to any complaints and inquiries resulting from the outage and providing timely updates on services that were affected.
BNM has required the banks to provide a full explanation of the root cause leading to the incidents, as well as corrective and preventive measures undertaken to avoid a recurrence of similar issues.
BNM expects all banking institutions to maintain high availability of banking services at all times. BNM will not hesitate to take further supervisory actions where the banks have fallen short of our regulatory and supervisory expectations.
Bank Negara Malaysia
9 April 2024
© Bank Negara Malaysia, 2024. All rights reserved.
| null | Press Release |
08 Apr 2024 | Statement by the Financial Markets Committee on the Ringgit Foreign Exchange Market | https://www.bnm.gov.my/-/fmc-stmt-apr2024 | null | null |
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Statement by the Financial Markets Committee on the Ringgit Foreign Exchange Market
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Statement by the Financial Markets Committee on the Ringgit Foreign Exchange Market
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Monday, 8 April 2024
8 Apr 2024
The Financial Markets Committee (FMC) convened today to discuss recent developments in the ringgit foreign exchange market.
Since the last FMC meeting on 1 March 2024, the movements of ringgit and regional currencies continue to be driven by global factors, particularly uncertainties surrounding the timing and extent of interest rate adjustments by major central banks. This was further evidenced by the stronger-than-expected US labour market data last Friday, indicating a more resilient US economy, and thus increases the risk of the US Fed maintaining interest rates “higher for longer”. Nevertheless, the meeting noted market expectations remain for the Fed to lower interest rates in 2H of 2024.
FMC members noted that this morning, the ringgit traded in an orderly manner. It opened at 4.7475, the same level as Friday’s close and moved in tandem with other regional currencies.
The meeting further discussed the impact of the ongoing coordinated efforts to encourage more consistent inflows by the government-linked companies (GLCs) and government-linked investment companies (GLICs), as well as greater engagements with Malaysian corporates and businesses.
Since 26 February, the ringgit was the only regional currency that strengthened against the US dollar (USD), gaining 0.6%[1].
Across the same period, the average daily FX volume was USD17.6 billion compared to USD15.5 billion in 2023. FMC members noted the higher FX conversion activities in the onshore FX market, driven by the significant flows arising from the coordinated efforts as well as opportunistic selling of USD by certain exporters.
The meeting views that the ongoing coordinated efforts can be sustained given that the focus is on investment income and export revenue which are recurring in nature. In addition, a more sustained ringgit strengthening could spur greater interest for FX conversion by corporates with excess foreign currency holdings, further supporting sentiment on the ringgit. The meeting was particularly encouraged by BNM’s enhanced efforts to further promote FX conversion activities by Malaysian corporates and businesses.
FMC Chairman and Bank Negara Malaysia Deputy Governor, Adnan Zaylani stated, “The current level of ringgit is deemed undervalued, particularly as Malaysia’s economic fundamentals continue to be strong and the economic prospect is positive.” In response to lingering concerns among market participants, he also reaffirmed, “BNM is not considering capital controls or restrictions like those introduced during the Asian Financial Crisis (AFC) taking into account the potential costs and impact to the economy.”
About The Financial Markets Committee (FMC)
The FMC is a committee established by BNM in May 2016 and comprises representatives from Bank Negara Malaysia, financial institutions, corporations, financial service providers and other institutions which have prominent role or participation in the financial markets.
[1] Regional currencies performance (from 26 Feb. to 5 Apr.): KRW (-1.6%), THB (-1.5%), IDR (-1.4%), CNY (-0.5%), SGD (-0.3%)
Bank Negara Malaysia
8 April 2024
© Bank Negara Malaysia, 2024. All rights reserved.
| null | Press Release |
05 Apr 2024 | International Reserves of Bank Negara Malaysia as at 29 March 2024 | https://www.bnm.gov.my/-/international-reserves-of-bank-negara-malaysia-as-at-29-march-2024 | https://www.bnm.gov.my/documents/20124/6118085/qb2021q4_en_box_imports.pdf | null |
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International Reserves of Bank Negara Malaysia as at 29 March 2024
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International Reserves of Bank Negara Malaysia as at 29 March 2024
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5 Apr 2024
The international reserves of Bank Negara Malaysia amounted to USD113.8 billion as at 29 March 2024. The reserves level has taken into account the quarterly foreign exchange revaluation changes. The reserves position is sufficient to finance 5.6 months of imports of goods and services[1], and is 1.0 times of the total short-term external debt.
[1] Under the previous import coverage measure, reserves is sufficient to finance 7.0 months of retained imports of goods. For more information on the new indicator, please refer to the article on “Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to Imports of Goods and Services” in BNM’s Quarterly Bulletin for the Fourth Quarter of 2021 publication, page 27, which can be accessed at Quarterly Bulletin 4Q2021. Related Assets
BNM Statement of Assets & Liabilities - 29 March 2024
Bank Negara Malaysia
5 April 2024
© Bank Negara Malaysia, 2024. All rights reserved.
|
Monthly Highlights
Headline inflation declined to 3.4% in March
March 2023
1
3.7 3.4
3.9 3.8
0.00
2.00
4.00
0.0
2.0
4.0
J
a
n
-2
2
F
e
b
-2
2
M
a
r-
2
2
A
p
r-
2
2
M
a
y
-2
2
J
u
n
-2
2
J
u
l-
2
2
A
u
g
-2
2
S
e
p
-2
2
O
c
t-
2
2
N
o
v
-2
2
D
e
c
-2
2
J
a
n
-2
3
F
e
b
-2
3
M
a
r-
2
3
Food & non-alcohol (29.5%) Housing & utilities (23.8%)
Transport (14.6%) Others (32.1%)
Headline inflation (RHS) Core inflation¹ (RHS)
Contribution to Inflation
ppt. contribution %, yoy
1 Core inflation is computed by excluding price-volatile and price-administered items.
Source: Department of Statistics, Malaysia & Bank Negara Malaysia estimates
• Headline inflation declined to 3.4% in March
(February: 3.7%) due mainly to lower inflation for
fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation moderated slightly to 3.8% during
the month (February: 3.9%), driven largely by
lower inflation for food away from home.
1
Robust growth in volume index driven by retail and motor vehicles
Index of Wholesale and Retail Trade
Source: Department of Statistics, Malaysia
• The Index of Wholesale and Retail Trade
(IOWRT) expanded by 10.6% in February 2023
(January: 8.5%).
• The higher growth was driven mainly by retail
sales in non-specialised stores (e.g., department
stores) followed by continued strength in
purchases of motor vehicles amid the ongoing
fulfilment of backlog orders.
• On a month-on-month seasonally adjusted basis,
the index accelerated by 5.5% (January: 0.2%).
9.5 8.510.6
0
10
20
30
40
Feb-
22
Mar-
22
Apr-
22
May-
22
Jun-
22
Jul-
22
Aug-
22
Sep-
22
Oct-
22
Nov-
22
Dec-
22
Jan-
23
Feb-
23
ppt, %yoy
Motor vehicles Retail Wholesale
2.4
5.2
4.4
0
1
2
3
4
5
6
7
Mar-22 Jul-22 Nov-22 Mar-23
Business loans
Household loans
Corporate bonds
Annual growth (%)
Growth in credit to the private non-financial sector moderated
1 Comprises loans to households and non-financial corporations from the
banking system and development financial institutions (DFIs), and corporate
bonds issued by non-financial corporations (including short-term papers).
2 Starting with the publication of December 2022 Monthly Highlights and
Statistics (MHS), this series was introduced to enhance the quality of
financing data. This new data series is available in the MHS Table 2.18.
Source: Bank Negara Malaysia
2.7 2.6 2.7 2.6
1.0 0.6 0.7 0.7
1.0
1.1 1.1 0.9
4.7 4.3 4.5 4.2
Dec-22 Jan-23 Feb-23 Mar-23
Corporate Bonds
Business Loans
Household Loans
Credit to the Private Non-
Financial Sector
Contribution to growth (ppt)
• Credit to the private non-financial sector grew by
4.2% as at end-March (February: 4.5%), attributed
to slower growth in credit to businesses (3.2%;
February: 3.7%).
• While growth in outstanding corporate bonds
moderated (4.4%; February : 5.5%), outstanding
business loan growth was sustained at 2.4%
(February: 2.4%). This was supported by the
continued growth in both working capital (2.2%;
February: 1.9%) and investment-related loans
(4.3%; February: 4.2%).
• Outstanding household loan growth remained
broadly stable (5.2%; February: 5.3%), supported
by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan
growth for the purchase of securities (-6.9%;
February: -3.3%).
Credit to the Private Non-Financial Sector1,2
Monthly Highlights
March 2023
Domestic financial market conditions remained orderly
Financial Market Performance in March 2023
Source: Bank Negara Malaysia, Bursa Malaysia
Note: The exchange rate data is the noon-rate in the Kuala Lumpur Interbank Foreign Exchange Market
11.0
-2.1
-5.3
0.0
-2.2
1.7
10-year MGS
(bps, mom)
Equity
(%, mom)
Ringgit
(%, mom)
-10 -5 0 5 10 15
Mar-23
Feb-23
• In March, global financial markets were affected by
the emergence of banking sector stress in some
major economies. As spillovers were contained thus
far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds
improved.
• In line with the performance of regional currencies,
the ringgit appreciated by 1.7% against the US
dollar. Conditions in the domestic bond market
also remained stable.
• The FBM KLCI declined by 2.2% during the month.
2
Banks maintained strong liquidity and funding positions to support intermediation
Source: Bank Negara Malaysia
Banking System Liquidity and Funding Ratios
81.9
157.4
0
40
80
120
160
70
75
80
85
90
95
M
a
r
2
2
A
p
r
2
2
M
a
y
2
2
J
u
n
2
2
J
u
l
2
2
A
u
g
2
2
S
e
p
2
2
O
c
t
2
2
N
o
v
2
2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
% %
Liquidity Coverage Ratio (RHS)
Loan-to-Fund Ratio
Asset quality in the banking system remained intact
Banking System Asset Quality
Source: Bank Negara Malaysia
• Overall gross and net impaired loans ratios
increased slightly to 1.8% (February-23: 1.8%) and
1.2% (February-23: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory
reserves) continue to record a prudent level of
110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
%
1.8
1.2
1.7
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
M
a
r
2
2
A
p
r
2
2
M
a
y
2
2
J
u
n
2
2
J
u
l
2
2
A
u
g
2
2
S
e
p
2
2
O
c
t
2
2
N
o
v
2
2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
Gross Impaired Loans Ratio
Total Provisions to Total Loans Ratio
Net Impaired Loans Ratio
• Banks continued to record healthy liquidity buffers
with the aggregate Liquidity Coverage Ratio at
157.4% (February-23: 152.7%).
• The aggregate loan-to-fund ratio remained stable at
81.9% (February-23: 81.6%).
PRESS RELEASE
Ref. No.: 04/23/05 EMBARGO: Not for publication or
broadcast before 1500 hours on
Friday, 28 April 2023
Monthly Highlights – March 2023
Headline inflation declined to 3.4% in March
• Headline inflation declined to 3.4% in March (February: 3.7%) due mainly
to lower inflation for fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation1 moderated slightly to 3.8% during the month
(February: 3.9%), driven largely by lower inflation for food away from
home.
Robust growth in volume index driven by retail and motor vehicles
• The Index of Wholesale and Retail Trade (IOWRT) expanded by 10.6%
in February 2023 (January: 8.5%).
• The higher growth was driven mainly by retail sales in non-specialised
stores (e.g., department stores) followed by continued strength in
purchases of motor vehicles amid the ongoing fulfilment of backlog
orders.
• On a month-on-month seasonally adjusted basis, the index accelerated
by 5.5% (January: 0.2%).
1 Core inflation is computed by excluding price-volatile and price-administered items.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Growth in credit to the private non-financial sector2,3 moderated
• Credit to the private non-financial sector grew by 4.2% as at end-March
(February: 4.5%), attributed to slower growth in credit to businesses
(3.2%; February: 3.7%).
• While growth in outstanding corporate bonds moderated (4.4%;
February: 5.5%), outstanding business loan growth was sustained at
2.4% (February: 2.4%). This was supported by the continued growth in
both working capital (2.2%; February: 1.9%) and investment-related
loans (4.3%; February: 4.2%).
• Outstanding household loan growth remained broadly stable (5.2%;
February: 5.3%), supported by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan growth for the purchase of
securities (-6.9%; February: -3.3%).
Domestic financial market conditions remained orderly
• In March, global financial markets were affected by the emergence of
banking sector stress in some major economies. As spillovers were
contained thus far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds improved.
• In line with the performance of regional currencies, the ringgit
appreciated by 1.7% against the US dollar. Conditions in the domestic
bond market also remained stable.
• The FBM KLCI declined by 2.2% during the month.
Banks maintained strong liquidity and funding positions to support
intermediation
• Banks continued to record healthy liquidity buffers with the aggregate
Liquidity Coverage Ratio at 157.4% (February: 152.7%).
2 Comprises loans to households and non-financial corporations from the banking system and development financial
institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers).
3 Starting with the publication of December 2022 Monthly Highlights and Statistics (MHS), this series was introduced
to enhance the quality of financing data. This new data series is available in the MHS Table 2.18.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
• The aggregate loan-to-fund ratio remained stable at 81.9%
(February: 81.6%).
Asset quality in the banking system remained intact
• Overall gross and net impaired loans ratios increased slightly to 1.8%
(February: 1.8%) and 1.2% (February: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory reserves) continues to
record a prudent level of 110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
Bank Negara Malaysia
28 April 2023
20230428_BNM Monthly Highlights-March_en
Slide 1
Slide 2
20230428_BNM PR_Monthly Highlights-Mar 2023_eng
| Press Release |
03 Apr 2024 | BNM’s Engagements with Stakeholders in Conjunction with the Release of Its Flagship Publications | https://www.bnm.gov.my/-/ar2023_en_nggmt | null | null |
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BNM’s Engagements with Stakeholders in Conjunction with the Release of Its Flagship Publications
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BNM’s Engagements with Stakeholders in Conjunction with the Release of Its Flagship Publications
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Wednesday, 3 April 2024
Bank Negara Malaysia (BNM) organised a series of engagements with various stakeholders since 20 March 2024 in conjunction with the release of its Annual Report 2023 (AR 2023), Economic and Monetary Review 2023 (EMR 2023), and Financial Stability Review for the Second Half 2023 (FSR 2H 2023).
The engagements sought to share BNM’s assessment of Malaysia’s economy and financial sector, as well as gain feedback from our stakeholders. These engagements involved Government ministries and agencies, the diplomatic corps, the banking, insurance and takaful, and payment industries, economists, banking analysts and fund managers, businesses including small and medium enterprises (SMEs), and the media.
Some of the key issues discussed are as follows:
Growth and inflation
Key stakeholders discussed the growth and inflation outlook for Malaysia this year and the likely action of the Monetary Policy Committee (MPC).
BNM highlighted that Malaysia’s economy is expected to grow between 4% and 5% in 2024, supported by increased domestic spending and a recovery in exports. The growth outlook is in line with analysts’ expectations, as reflected in their respective growth forecasts and assessments.
BNM expects headline inflation to average between 2% and 3.5% in 2024. The wider forecast range accounts for some upside impact on inflation from the implementation of subsidy rationalisation. The overall impact on inflation would be dependent on the magnitude and timing of fuel price adjustments, as well as mitigating measures such as targeted cash transfers. BNM shared that in the short run, subsidy rationalisation could impact private consumption. However, this would be mitigated partly by targeted assistance from the Government.
Monetary policy will continue to be forward-looking and informed by the MPC’s assessment of the prospects of domestic inflation and growth.
The positive growth trajectory and moderate inflation this year present a window of opportunity for the implementation of structural reforms. A more targeted approach towards fuel subsidies is critical to help mitigate the impact on the cost of living on the rakyat. Not only will it ensure that assistance is preserved for those who need it, but cost savings from the fuel subsidy rationalisation will create much-needed fiscal room for critical investments into health, education, and public infrastructure initiatives.
Ringgit
Discussions surrounding the ringgit focused on BNM’s assessment of the ringgit performance and the tools that could be deployed to provide support, including whether BNM would consider raising the Overnight Policy Rate (OPR).
On the ringgit performance, BNM maintains that the ringgit is currently undervalued. Greater policy rate increases in other countries relative to Malaysia is one of the main factors causing the depreciation of the ringgit. In the long term, exchange rates are anchored by domestic fundamentals. In this respect, Malaysia’s economic fundamentals are sound. This is evident from key economic indicators in 2023 and the projections for 2024. The effective implementation of the national plans and other structural reforms will strengthen Malaysia’s competitiveness and production capacity, thus providing enduring support to the ringgit. Looking ahead, expect the ringgit to appreciate as the effects from global factors subside.
BNM reiterated that the OPR is not a tool to manage the ringgit exchange rate. Instead, BNM has and will continue to take concerted measures to manage short-term pressure on the ringgit. This includes intensified efforts to encourage repatriation and conversion of realised foreign investment income by government-linked corporations (GLCs) and government-linked investment corporations (GLICs), stepping up its engagements with corporates and investors, and continued monitoring of domestic exporters’ and importers’ behaviours and engaging them on any unusual trends observed. BNM also made it clear that GLCs and GLICs are not expected to liquidate their foreign investments to repatriate foreign currency proceeds to Malaysia. Rather, BNM encourages them to repatriate realised foreign currency investment income on a more regular basis. BNM welcomes the acknowledgement and support of the Federation of Malaysian Manufacturers (FMM) and the Small and Medium Enterprises Association of Malaysia (SAMENTA) to be part of the whole-of-nation approach needed to ensure the stability of the ringgit. BNM would encourage others to do the same.
BNM also clarified that Malaysia’s international reserves are adequate and sufficient to finance 5.4 months of imports of goods and services and is 1.0 times the total short-term external debt as of 15 March 2024. International reserves are meant to be drawn on when necessary. However, BNM continues to do this judiciously. In addition, Malaysia’s long-standing decentralisation of international reserves has led to the accumulation of sizeable non-reserve external assets. Resident banks and corporates hold more than three-quarters of Malaysia’s external assets. These assets can be drawn upon to meet their short-term external debt obligations without creating a claim on international reserves.
Structural reforms
Most key stakeholders were keen to understand the mechanics, sequence and timing of the Government’s implementation of structural reforms.
BNM highlighted that the Government has been clear on their reform agenda. This includes strategic reforms outlined in key policy documents, such as the National Investment Aspirations (NIA), New Industry Master Plan 2030 (NIMP), and National Energy Transition Roadmap (NETR). Several reform measures have already been implemented or are underway. This includes electricity tariff adjustment and price ceiling removals on items such as chicken.
Beyond this, BNM strongly advocates the development of a future-ready workforce through labour market reforms, as well as strengthening social protection programmes are key structural reforms needed in Malaysia. The execution of these reforms will raise our competitiveness, ensure more sustainable growth and improve our standard of living. Key stakeholders also echoed the importance of effective implementation of structural reforms and the subsequent impact on economic growth and the ringgit.
Bank Negara Malaysia
3 April 2024
© Bank Negara Malaysia, 2024. All rights reserved.
| null | Press Release |
03 Apr 2024 | Brunei Darussalam Central Bank and Bank of the Lao P.D.R. Formally Join the Regional Payment Connectivity Initiative | https://www.bnm.gov.my/-/rpc-cb-en | null | null |
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Brunei Darussalam Central Bank and Bank of the Lao P.D.R. Formally Join the Regional Payment Connectivity Initiative
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Brunei Darussalam Central Bank and Bank of the Lao P.D.R. Formally Join the Regional Payment Connectivity Initiative
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3 Apr 2024
Brunei Darussalam Central Bank (BDCB) and Bank of the Lao P.D.R. (BOL) have officially joined the Regional Payment Connectivity (RPC) after previously expressing their interest in joining the initiative. BDCB signed the second supplemental pages of the Memorandum of Understanding on Cooperation in Regional Payment Connectivity (MOU RPC) on 29th February 2024. Meanwhile BOL signed the third supplemental pages of MOU RPC on 3 April 2024, at the sidelines of the 11th ASEAN Finance Ministers’ and Central Bank Governors’ Meeting in Luang Prabang, Lao P.D.R.
The inclusion of BDCB and BOL bring the RPC group to a total of eight ASEAN central banks. Pioneered by the central banks of Indonesia, Malaysia, the Philippines, Singapore, and Thailand in late 2022, later joined by Vietnam in August 2023 and now Brunei Darussalam and Lao P.D.R., the RPC initiative is expected to be extended to other ASEAN countries and beyond.
RPC is an initiative that aims to promote, faster, cheaper, more transparent, and more inclusive cross-border payments. Since its inception in 2022, the RPC has strengthened the central banks’ ability to foster and accelerate the development of payment connectivity in the region through, among others, quick response (QR) code-based payment and fast payment modalities. The regional effort also allows participants to reap the benefits of cross-border economic activities, including providing small and medium-sized enterprises access to the international market, easing of trade, and facilitating worker remittance transactions.
Hajah Rokiah binti Haji Badar, the Managing Director of BDCB, expressed her contentment for BDCB in becoming a signatory to the MOU RPC alongside Indonesia, Malaysia, Philippines, Singapore, Thailand, and Vietnam. She also stated that the scope and areas of cooperation in the MOU RPC will be beneficial, particularly in advancing cross-border payment connectivity. This will serve as a means to facilitate further trade, investments, and economic activities within the region and further foster close collaboration with fellow central banks.
Bounleua Xinxayvoravong, the Governor of BOL, has emphasized that the signing of the MOU RPC is a significant move toward enhancing future ASEAN regional cooperation. “A faster and cheaper financial transactions as well as a secure and seamless payment system infrastructure will support the expansion and sustainability of our economy,” she added.
Bank Negara Malaysia
Brunei Darussalam Central Bank
Bank Indonesia
Bank of the Lao P.D.R.
Bangko Sentral ng Pilipinas
Monetary Authority of Singapore
Bank of Thailand
State Bank of Vietnam
3 April 2024
© Bank Negara Malaysia, 2024. All rights reserved.
| null | Press Release |
29 Mar 2024 | Monetary and Financial Developments in February 2024 | https://www.bnm.gov.my/-/monetary-and-financial-developments-in-february-2024 | https://www.bnm.gov.my/documents/20124/13953502/i_en.pdf | null |
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Monetary and Financial Developments in February 2024
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Monetary and Financial Developments in February 2024
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29 Mar 2024
Headline inflation edged higher, while core inflation[1] remained unchanged
Headline inflation increased to 1.8% in February (January 2024: 1.5%), while core inflation remained unchanged at 1.8% (January 2024: 1.8%).
The increase in inflation is driven mainly by higher inflation for utilities, following upward revision in water tariffs in early February. For core inflation, higher food away from home inflation was largely offset by lower inflation for actual rental paid by tenants.
Manufacturing industrial production index (IPI) rebounded to 3.7% in January 2024
The manufacturing industrial production index grew by 3.7% in January 2024 (December 2023: -1.4%).
Growth in the export-oriented clusters turned around amid stronger production of chemical, rubber, and plastic products while production of electrical and electronics (E&E) registered a modest rebound.
Meanwhile, growth in the domestic-oriented clusters improved further, reflecting higher production of both transport equipment and construction materials.
Sustained growth in credit to the private non-financial sector[2], [3]
Credit to the private non-financial sector grew by 5.1% as at end-February 2024 (January 2024: 5%), supported by higher growth in outstanding loans (5.6%; January 2024: 5.4%).
Outstanding business loan growth increased to 4.7% (January 2023: 4.3%), driven by higher growth in both working capital and investment-related loans. Meanwhile, outstanding corporate bonds growth moderated to 3.3% (January 2024: 3.6%).
For households, outstanding loan growth remained stable at 6.1% (January 2024: 6%), with sustained growth across key loan purposes. Of note, growth in household loan disbursements has remained forthcoming (11.1%; January 2024: 19%).
Domestic financial markets were mainly driven by global investors’ expectations that the US Federal Reserve would keep its policy rate high for longer
Global financial markets reacted to expectations that the US Federal Reserve would make fewer rate cuts and maintain its current high policy interest rate for longer in light of the release of strong US labour market data and persistently elevated core inflation.
Against this backdrop, the ringgit depreciated by 0.7% against the US dollar (regional[4] average: -0.1%), while the 10-year Malaysian Government Securities (MGS) yield increased by 7 bps (regional4 average: +7 bps).
Meanwhile, FBM KLCI traded higher by 2.5% amid foreign equity inflows (regional4 average: +3.1%).
Banks liquidity and funding positions are strong to support intermediation
Banking system continues to record healthy liquidity buffers with the aggregate Liquidity Coverage Ratio at 153.7% (January 2024: 160.2%).
The aggregate loan-to-fund ratio remained broadly stable at 81.8% (January 2024: 81.6%).
Asset quality in the banking system remained intact
Overall gross and net impaired loans ratios remained stable at 1.6% and 1% respectively.
Loan loss coverage ratio (including regulatory reserves) continues to be at a prudent level of 120% (January 2024: 120.8%) of impaired loans, with total provisions accounting for 1.5% of total loans.
[1] Core inflation is computed by excluding price-volatile and price-administered items.
[2] Comprises loans to households and non-financial corporations from the banking system and development financial institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers).
[3] Starting with the publication of December 2022 Monthly Highlights and Statistics (MHS), this series was introduced to enhance the quality of financing data. This new data series is available in the MHS Table 2.18.
[4] Regional countries comprise: Singapore, Thailand, Philippines, Indonesia, and South Korea.
Monthly Highlights [PDF] Related Assets
Monthly Highlights & Statistics in February 2024
Bank Negara Malaysia
29 March 2024
© Bank Negara Malaysia, 2024. All rights reserved.
|
Monthly Highlights May 2023
Monthly Highlights
Headline inflation declined further to 2.8% in May
May 2023
Contribution to Inflation
ppt. contribution %, yoy
1 Core inflation is computed by excluding price-volatile and price-administered items.
Source: Department of Statistics, Malaysia & Bank Negara Malaysia estimates
• Headline inflation moderated to 2.8% (April 2023:
3.3%). This decline was largely due to non-core
CPI components, particularly lower inflation for
fuel (-0.2 percentage points, ppt) and fresh food
(-0.1ppt).
• Core inflation also declined slightly to 3.5% (April
2023: 3.6%) amid lower inflation for
communication services.
3.3
2.8
3.6 3.5
0.00
2.00
4.00
0.0
2.0
4.0
J
a
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-2
2
F
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-2
2
M
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2
2
A
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2
M
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-2
2
J
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-2
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2
2
A
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3
M
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-2
3
Food & non-alcohol (29.5%) Housing & utilities (23.8%)
Transport (14.6%) Others (32.1%)
Headline inflation (RHS) Core inflation¹ (RHS)
1.6
5.1
4.6
0
1
2
3
4
5
6
7
May-22 Sep-22 Jan-23 May-23
Business loans
Household loans
Corporate bonds
Annual growth (%)
Credit to the Private Non-Financial Sector1,2
1
Growth in credit to the private non-financial sector improved in May
1 Comprises loans to households and non-financial corporations from the
banking system and development financial institutions (DFIs), and corporate
bonds issued by non-financial corporations (including short-term papers).
2 Starting with the publication of December 2022 Monthly Highlights and
Statistics (MHS), this series was introduced to enhance the quality of
financing data. This new data series is available in the MHS Table 2.18.
Source: Bank Negara Malaysia
Contribution to growth (ppt)
• Credit to the private non-financial sector expanded
by 4.0% as at end-May (April 2023: 3.7%), driven
mainly by higher growth in credit to businesses
(2.8%; April 2023: 2.5%).
• Outstanding corporate bonds grew by 4.6% (April
2023: 4.4%), while outstanding business loans
expanded by 1.6% (April 2023: 1.0%). The higher
business loan growth reflected improvement in
loans for both working capital and investments to
SMEs and non-SMEs.
• In the household segment, outstanding loan
growth was sustained at 5.1% (April 2023: 5.0%),
supported by higher growth across most loan
purposes. Of note, household loan growth
continued to be driven by loans for the purchase of
houses and cars, which grew by 7.0% and 8.4%,
respectively (April 2023: 6.8% and 8.0%).
2.7 2.6 2.5 2.6
0.7 0.7 0.3 0.5
1.1 0.9
0.9 1.0
4.5 4.2
3.7 4.0
Feb-23 Mar-23 Apr-23 May-23
Corporate Bonds
Business Loans
Household Loans
Credit to the Private Non-
Financial Sector
Index of wholesale and retail trade growth moderated in April
Source: Department of Statistics, Malaysia
• The Index of Wholesale and Retail Trade
(IOWRT) expanded more moderately by 4.7% in
April 2023 (March 2023: 9.4%). The lower growth
was due mainly to the decline in the motor vehicle
segment.
• However, the retail segment continued to record a
double-digit growth of 10.0% (March 2023:
13.8%), supported by sales in non-specialised and
other specialised stores1.
• On a month-on-month seasonally adjusted basis,
the index increased at a faster pace of 6.5%
(March 2023: -0.9%).
1 Other goods in specialised stores includes clothing, footwear,
pharmaceuticals, cosmetics, watches, jewellery and optical goods.
10.6
9.4
4.7
-2
3
8
13
18
23
28
33
Apr-22 Jun-22 Aug-22 Oct-22 Dec-22 Feb-23 Apr-23
ppt, %yoy
Motor vehicles Retail Wholesale
Index of Wholesale and Retail Trade
Monthly Highlights
2
May 2023
Domestic financial markets were largely affected by external factors
Financial Market Performance in May 2023
-18.0
-0.5
-1.1
-3.0
-2.0
-3.4
10-year MGS
(bps, mom)
Equity
(%, mom)
Ringgit
(%, mom)
-20 -15 -10 -5 0
May-23 Apr-23
Note: The exchange rate data is the noon-rate in the Kuala Lumpur Interbank Foreign Exchange Market
1Regional countries comprise Singapore, Thailand, Philippines, Indonesia, and Korea
Source: Bank Negara Malaysia, Bursa Malaysia
• Global investors maintained a risk-off approach
throughout May, as concerns over the impact of the
US debt ceiling crisis and the weaker-than-
expected rebound in China’s economy weighed on
global financial markets.
• As a result, the ringgit depreciated against the US
dollar by 3.4% (regional1 average: -1.2%). Similarly,
the FBM KLCI declined by 2.0% (regional1 average:
-1.3%).
• Nonetheless, the 10-year MGS yields decreased
slightly by 3 basis points, supported by non-resident
inflows into the domestic bond market.
Banks maintained strong liquidity and funding positions to support intermediation
• Banks continued to record healthy liquidity buffers
with the aggregate Liquidity Coverage Ratio at
151.2% (April 2023: 154.3%).
• The aggregate loan-to-fund ratio remained stable at
81.8% (April 2023: 82.1%).
Source: Bank Negara Malaysia
Banking System Liquidity and Funding Ratios
81.8
151.2
0
40
80
120
160
70
75
80
85
90
95
M
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2
2
J
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2
J
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2
A
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2
2
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2
2
O
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2
2
N
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2
2
D
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2
2
J
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2
3
F
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b
2
3
M
a
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2
3
A
p
r
2
3
M
a
y
2
3
% %
Liquidity Coverage Ratio (RHS)
Loan-to-Fund Ratio
Asset quality in the banking system remained intact
Banking System Asset Quality
Source: Bank Negara Malaysia
• Overall gross and net impaired loans ratios
remained broadly unchanged at 1.80% (April
2023: 1.78%) and 1.10% (April 2023: 1.10%),
respectively.
• Loan loss coverage ratio (including regulatory
reserves) remained at a prudent level of 114.1%
of impaired loans, with total provisions accounting
for 1.7% of total loans.
%
1.8
1.1
1.7
0.5
1.0
1.5
2.0
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A
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2
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M
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2
3
Gross Impaired Loans Ratio
Total Provisions to Total Loans Ratio
Net Impaired Loans Ratio
April 2023 Monthly Highlights
Slide 1
Slide 2
| Press Release |
29 Mar 2024 | Detailed Disclosure of International Reserves as at end-February 2024 | https://www.bnm.gov.my/-/detailed-disclosure-of-international-reserves-as-at-end-february-2024-1 | null | null |
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Detailed Disclosure of International Reserves as at end-February 2024
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Detailed Disclosure of International Reserves as at end-February 2024
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In accordance with the IMF SDDS format, the detailed breakdown of international reserves provides forward-looking information on the size, composition and usability of reserves and other foreign currency assets, and the expected and potential future inflows and outflows of foreign exchange of the Federal Government and Bank Negara Malaysia over the next 12-month period.
The detailed breakdown of international reserves based on the SDDS format is shown in Tables I, II, III and IV.
As shown in Table I, official reserve assets amounted to USD114,277.5 million, while other foreign currency assets amounted to USD202.7 million as at end-February 2024.
As shown in Table II, for the next 12 months, the pre-determined short-term outflows of foreign currency loans, securities and deposits, which include among others, scheduled repayment of external borrowings by the Government and the maturity of foreign currency Bank Negara Interbank Bills, amounted to USD16,329.5 million. The net short forward positions amounted to USD22,586.1 million as at end-February 2024, reflecting the management of ringgit liquidity in the money market. In line with the practice adopted since April 2006, the data excludes projected foreign currency inflows arising from interest income and the drawdown of project loans. Projected foreign currency inflows amount to USD2,458.2 million in the next 12 months.
As shown in Table III, the only contingent short-term net drain on foreign currency assets are Government guarantees of foreign currency debt due within one year, amounting to USD400.9 million. There are no foreign currency loans with embedded options, no undrawn, unconditional credit lines provided by or to other central banks, international organisations, banks and other financial institutions. Bank Negara Malaysia also does not engage in foreign currency options vis-à-vis ringgit.
Overall, the detailed breakdown of international reserves under the IMF SDDS format indicates that as at end-February 2024, Malaysia’s international reserves remain usable.
Bank Negara Malaysia
29 March 2024 Related Assets
International Reserves and Foreign Currency Liquidity (29 February 2024)
© Bank Negara Malaysia, 2024. All rights reserved.
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22 Mar 2024 | International Reserves of Bank Negara Malaysia as at 15 March 2024 | https://www.bnm.gov.my/-/international-reserves-of-bank-negara-malaysia-as-at-15-march-2024 | https://www.bnm.gov.my/documents/20124/6118085/qb2021q4_en_box_imports.pdf | null |
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International Reserves of Bank Negara Malaysia as at 15 March 2024
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International Reserves of Bank Negara Malaysia as at 15 March 2024
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The international reserves of Bank Negara Malaysia amounted to USD113.4 billion as at 15 March 2024. The reserves position is sufficient to finance 5.4 months of imports of goods and services[1], and is 1.0 times of the total short-term external debt.
[1] Under the previous import coverage measure, reserves is sufficient to finance 6.7 months of retained imports of goods. For more information on the new indicator, please refer to the article on “Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to Imports of Goods and Services” in BNM’s Quarterly Bulletin for the Fourth Quarter of 2021 publication, page 27, which can be accessed at bnm.gov.my/-/quarterly-bulletin-4q-2021 Related Assets
BNM Statement of Assets & Liabilities - 15 March 2024
Bank Negara Malaysia
22 March 2024
© Bank Negara Malaysia, 2024. All rights reserved.
|
Monthly Highlights
Headline inflation declined to 3.4% in March
March 2023
1
3.7 3.4
3.9 3.8
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4.00
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2.0
4.0
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Food & non-alcohol (29.5%) Housing & utilities (23.8%)
Transport (14.6%) Others (32.1%)
Headline inflation (RHS) Core inflation¹ (RHS)
Contribution to Inflation
ppt. contribution %, yoy
1 Core inflation is computed by excluding price-volatile and price-administered items.
Source: Department of Statistics, Malaysia & Bank Negara Malaysia estimates
• Headline inflation declined to 3.4% in March
(February: 3.7%) due mainly to lower inflation for
fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation moderated slightly to 3.8% during
the month (February: 3.9%), driven largely by
lower inflation for food away from home.
1
Robust growth in volume index driven by retail and motor vehicles
Index of Wholesale and Retail Trade
Source: Department of Statistics, Malaysia
• The Index of Wholesale and Retail Trade
(IOWRT) expanded by 10.6% in February 2023
(January: 8.5%).
• The higher growth was driven mainly by retail
sales in non-specialised stores (e.g., department
stores) followed by continued strength in
purchases of motor vehicles amid the ongoing
fulfilment of backlog orders.
• On a month-on-month seasonally adjusted basis,
the index accelerated by 5.5% (January: 0.2%).
9.5 8.510.6
0
10
20
30
40
Feb-
22
Mar-
22
Apr-
22
May-
22
Jun-
22
Jul-
22
Aug-
22
Sep-
22
Oct-
22
Nov-
22
Dec-
22
Jan-
23
Feb-
23
ppt, %yoy
Motor vehicles Retail Wholesale
2.4
5.2
4.4
0
1
2
3
4
5
6
7
Mar-22 Jul-22 Nov-22 Mar-23
Business loans
Household loans
Corporate bonds
Annual growth (%)
Growth in credit to the private non-financial sector moderated
1 Comprises loans to households and non-financial corporations from the
banking system and development financial institutions (DFIs), and corporate
bonds issued by non-financial corporations (including short-term papers).
2 Starting with the publication of December 2022 Monthly Highlights and
Statistics (MHS), this series was introduced to enhance the quality of
financing data. This new data series is available in the MHS Table 2.18.
Source: Bank Negara Malaysia
2.7 2.6 2.7 2.6
1.0 0.6 0.7 0.7
1.0
1.1 1.1 0.9
4.7 4.3 4.5 4.2
Dec-22 Jan-23 Feb-23 Mar-23
Corporate Bonds
Business Loans
Household Loans
Credit to the Private Non-
Financial Sector
Contribution to growth (ppt)
• Credit to the private non-financial sector grew by
4.2% as at end-March (February: 4.5%), attributed
to slower growth in credit to businesses (3.2%;
February: 3.7%).
• While growth in outstanding corporate bonds
moderated (4.4%; February : 5.5%), outstanding
business loan growth was sustained at 2.4%
(February: 2.4%). This was supported by the
continued growth in both working capital (2.2%;
February: 1.9%) and investment-related loans
(4.3%; February: 4.2%).
• Outstanding household loan growth remained
broadly stable (5.2%; February: 5.3%), supported
by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan
growth for the purchase of securities (-6.9%;
February: -3.3%).
Credit to the Private Non-Financial Sector1,2
Monthly Highlights
March 2023
Domestic financial market conditions remained orderly
Financial Market Performance in March 2023
Source: Bank Negara Malaysia, Bursa Malaysia
Note: The exchange rate data is the noon-rate in the Kuala Lumpur Interbank Foreign Exchange Market
11.0
-2.1
-5.3
0.0
-2.2
1.7
10-year MGS
(bps, mom)
Equity
(%, mom)
Ringgit
(%, mom)
-10 -5 0 5 10 15
Mar-23
Feb-23
• In March, global financial markets were affected by
the emergence of banking sector stress in some
major economies. As spillovers were contained thus
far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds
improved.
• In line with the performance of regional currencies,
the ringgit appreciated by 1.7% against the US
dollar. Conditions in the domestic bond market
also remained stable.
• The FBM KLCI declined by 2.2% during the month.
2
Banks maintained strong liquidity and funding positions to support intermediation
Source: Bank Negara Malaysia
Banking System Liquidity and Funding Ratios
81.9
157.4
0
40
80
120
160
70
75
80
85
90
95
M
a
r
2
2
A
p
r
2
2
M
a
y
2
2
J
u
n
2
2
J
u
l
2
2
A
u
g
2
2
S
e
p
2
2
O
c
t
2
2
N
o
v
2
2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
% %
Liquidity Coverage Ratio (RHS)
Loan-to-Fund Ratio
Asset quality in the banking system remained intact
Banking System Asset Quality
Source: Bank Negara Malaysia
• Overall gross and net impaired loans ratios
increased slightly to 1.8% (February-23: 1.8%) and
1.2% (February-23: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory
reserves) continue to record a prudent level of
110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
%
1.8
1.2
1.7
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
M
a
r
2
2
A
p
r
2
2
M
a
y
2
2
J
u
n
2
2
J
u
l
2
2
A
u
g
2
2
S
e
p
2
2
O
c
t
2
2
N
o
v
2
2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
Gross Impaired Loans Ratio
Total Provisions to Total Loans Ratio
Net Impaired Loans Ratio
• Banks continued to record healthy liquidity buffers
with the aggregate Liquidity Coverage Ratio at
157.4% (February-23: 152.7%).
• The aggregate loan-to-fund ratio remained stable at
81.9% (February-23: 81.6%).
PRESS RELEASE
Ref. No.: 04/23/05 EMBARGO: Not for publication or
broadcast before 1500 hours on
Friday, 28 April 2023
Monthly Highlights – March 2023
Headline inflation declined to 3.4% in March
• Headline inflation declined to 3.4% in March (February: 3.7%) due mainly
to lower inflation for fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation1 moderated slightly to 3.8% during the month
(February: 3.9%), driven largely by lower inflation for food away from
home.
Robust growth in volume index driven by retail and motor vehicles
• The Index of Wholesale and Retail Trade (IOWRT) expanded by 10.6%
in February 2023 (January: 8.5%).
• The higher growth was driven mainly by retail sales in non-specialised
stores (e.g., department stores) followed by continued strength in
purchases of motor vehicles amid the ongoing fulfilment of backlog
orders.
• On a month-on-month seasonally adjusted basis, the index accelerated
by 5.5% (January: 0.2%).
1 Core inflation is computed by excluding price-volatile and price-administered items.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Growth in credit to the private non-financial sector2,3 moderated
• Credit to the private non-financial sector grew by 4.2% as at end-March
(February: 4.5%), attributed to slower growth in credit to businesses
(3.2%; February: 3.7%).
• While growth in outstanding corporate bonds moderated (4.4%;
February: 5.5%), outstanding business loan growth was sustained at
2.4% (February: 2.4%). This was supported by the continued growth in
both working capital (2.2%; February: 1.9%) and investment-related
loans (4.3%; February: 4.2%).
• Outstanding household loan growth remained broadly stable (5.2%;
February: 5.3%), supported by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan growth for the purchase of
securities (-6.9%; February: -3.3%).
Domestic financial market conditions remained orderly
• In March, global financial markets were affected by the emergence of
banking sector stress in some major economies. As spillovers were
contained thus far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds improved.
• In line with the performance of regional currencies, the ringgit
appreciated by 1.7% against the US dollar. Conditions in the domestic
bond market also remained stable.
• The FBM KLCI declined by 2.2% during the month.
Banks maintained strong liquidity and funding positions to support
intermediation
• Banks continued to record healthy liquidity buffers with the aggregate
Liquidity Coverage Ratio at 157.4% (February: 152.7%).
2 Comprises loans to households and non-financial corporations from the banking system and development financial
institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers).
3 Starting with the publication of December 2022 Monthly Highlights and Statistics (MHS), this series was introduced
to enhance the quality of financing data. This new data series is available in the MHS Table 2.18.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
• The aggregate loan-to-fund ratio remained stable at 81.9%
(February: 81.6%).
Asset quality in the banking system remained intact
• Overall gross and net impaired loans ratios increased slightly to 1.8%
(February: 1.8%) and 1.2% (February: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory reserves) continues to
record a prudent level of 110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
Bank Negara Malaysia
28 April 2023
20230428_BNM Monthly Highlights-March_en
Slide 1
Slide 2
20230428_BNM PR_Monthly Highlights-Mar 2023_eng
| Press Release |
20 Mar 2024 | Bank Negara Malaysia Publishes Annual Report 2023, Economic and Monetary Review 2023 and Financial Stability Review for Second Half 2023 | https://www.bnm.gov.my/-/ar2023_en_pr | https://www.bnm.gov.my/documents/20124/12142010/ar2023_slides.pdf, https://www.bnm.gov.my/documents/20124/12142010/ar2023_pctranscript.pdf | null |
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Bank Negara Malaysia Publishes Annual Report 2023, Economic and Monetary Review 2023 and Financial Stability Review for Second Half 2023
Embargo :
For immediate release
Not for publication or broadcast before
1230 on
Wednesday, 20 March 2024
20 Mar 2024
Bank Negara Malaysia (BNM) today published its Annual Report 2023 (AR 2023), Economic and Monetary Review 2023 (EMR 2023) and Financial Stability Review for Second Half 2023 (FSR 2H 2023).
Annual Report 2023
The AR 2023 details BNM's key initiatives in fulfilling its mandates to promote monetary and financial stability conducive to the sustainable growth of the Malaysian economy in 2023. It also provides an account of BNM’s operations and resources that enable it to function effectively and efficiently.
Highlights of AR 2023:
The Malaysian economy continued to show strength and resilience in 2023. Despite the challenging external environment, GDP grew by 3.7%. Amidst the slowdown in global economy and inflationary pressures domestically, BNM considered and managed the complex policy trade-offs and interdependencies between inflation, growth, and preserving confidence in the ringgit.
BNM’s efforts to ensure financial intermediation activities support the economic reform agenda with particular focus on micro, small and medium enterprises (MSMEs), by improving the features of our special funds and scaling up social finance initiatives.
Efforts to advance value-based intermediation and promote solutions by the Islamic finance industry to meet the demand for green and sustainable finance.
BNM continued its efforts to enhance climate resilience and manage climate-related risks within the financial sector. These efforts aimed to support financial institutions and the real sector transition to a greener economy, in line with national policies and strategies. BNM also continue to make progress in integrating climate-related risk into prudential regulation and supervision.
Combatting online financial fraud remained a key focus. BNM worked closely with the financial industry and law enforcement agencies to improve fund tracing, disrupt fraudulent fund flows and raise awareness on the latest scam tactics and prevention tips.
BNM launched the Financial Inclusion Framework 2023-2026 which outlines strategies to close the remaining gaps in access to quality and affordable financial services for all.
Key regulatory and supervisory programmes were put in place to further strengthen the ability of financial system to withstand shocks. We enhanced market conduct requirements for financial institutions to reinforce their responsibilities to safeguard consumer interests, especially when dealing with vulnerable consumers. BNM is also increasing the financial sector's preparedness to face crises through recovery and resolution planning, and simulation exercises.
Eight articles are featured in the AR 2023:
DuitNow QR: Fostering Inclusive Digital Payments
iTEKAD: An Ecosystem Approach in Scaling Up Social Finance
Realising the Value-based Intermediation Vision (VBI): Five Years After Introduction
Personalising Financial Services: Promoting Fair Treatment of Vulnerable Consumers
Supporting SMEs Transition to Greener Practices
BNM’s Enforcement Approach and Disclosures of Enforcement Actions
Behind the Scenes of Bank Negara Malaysia's Monetary Policymaking
Promoting Cross-border Local Currency Settlement (LCS)
The AR 2023 also sets out BNM’s Audited Financial Statements for the financial year ended 31 December 2023. As audited and certified by the Auditor General, the financial position of BNM remained stable in 2023. BNM’s total assets amounted to RM631.26 billion as at 31 December 2023. A net profit after tax of RM7.16 billion was recorded for the financial year, of which RM4.31 billion has been transferred into BNM’s Risk Reserve. BNM has declared a dividend of RM2.85 billion to the Government for the financial year 2023.
Economic and Monetary Review 2023
The Economic and Monetary Review sets out BNM’s economic assessments and forecasts.
Highlights of EMR 2023:
The Malaysian economy is projected to grow between 4% and 5% in 2024. This will be supported by the resilient domestic demand and improvement in external demand.
Headline inflation is expected to average between 2% and 3.5% in 2024 amid contained cost pressures from easing global supply conditions. Inflation outlook remains highly subject to upside risks due to potential price adjustments on food and energy items, as well as external pressures from exchange rate and global commodity price developments.
Domestic monetary and financial conditions remain conducive of financial intermediation. Credit supply will be supported by continued willingness of financial institutions to lend amid a strong banking system and a healthy capital market. In addition, the improving economic and labour market conditions will support credit demand.
BNM’s monetary policy will continue to be forward-looking with a focus on the trajectory of growth and inflation.
Given Malaysia’s strong fundamentals and positive growth prospects, the current ringgit level is undervalued.
Following this and beyond conducting foreign exchange operations, BNM has been actively engaging with government-linked companies (GLCs) and government-linked investment companies (GLICs) to encourage more consistent repatriation and conversion of their foreign investment income into ringgit. At the same time, BNM is closely monitoring the trends of foreign currency holdings by Malaysian corporates, exporters and importers. These actions are contributing to positive outcomes. BNM has seen increased flows and market interest in buying the ringgit.
Looking ahead, financial markets expect the ringgit to appreciate further into 2024 and continue on an appreciating trend as the effects of global factors subside. Some analysts have projected further into 2025 and assess the ringgit to continue strengthening.
The EMR 2023 features four box articles:
Underlying Inflation at its Core
Navigating Economic Cycles: Interactions between Monetary and Fiscal Policy
The Case for Labour Market Reforms in Malaysia: Challenges and Opportunities
The Ringgit in Perspective
Financial Stability Review for Second Half 2023
The Financial Stability Review is a biannual publication which details BNM’s assessment of domestic financial stability risks and outlook.
Highlights of FSR 2H 2023:
Despite global volatility, domestic financial markets remain orderly with continuous intermediation of two-way flows in the bond and equity markets.
The overall debt-servicing ability of businesses and households remains healthy. Evolving loan performance trends are within banks’ expectations.
Latest stress tests conducted by BNM affirm the resilience of financial institutions against unexpected losses from severe macroeconomic and financial shocks. This will continue to support financial institutions’ ability to fulfil financing and protection needs of household and businesses.
Strengthening operational and cyber resilience remains a top priority for BNM and financial institutions. BNM continues to require financial institutions to adopt strong cyber hygiene standards. BNM has also taken steps to strengthen collaboration with local and international counterparts through more timely sharing of cyber threat intelligence.
Four articles are featured in the FSR 2H 2023:
Progress in Strengthening Climate Risk Management Practices
Contagion Risk from Non-Bank Financial Institutions’ (NBFI) Activity
The Imperatives for Strengthened Regulation and Supervision of Liquidity Risk in Malaysia
Floods and Finance: Building Resilience of Malaysian Businesses
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said, “Our prospects are good. We have reason to cautiously anticipate a better year ahead. There is also a favourable window of opportunity to implement crucial structural reforms. By taking decisive and collective actions, we can capitalise on Malaysia’s robust and resilient economic rebound post-COVID and lay the path for sustained growth and prosperity. While there may be challenges during this transition, these reforms are investments in our future towards prosperity of our rakyat and the nation.”
For more details of the publications, please visit www.bnm.gov.my/AR2023
See also:
Press conference video
Press conference slides
Press conference transcript
Bank Negara Malaysia
20 March 2024
© Bank Negara Malaysia, 2024. All rights reserved.
|
Peluasan Ukuran Liputan Rizab Bagi Import – daripada Import Tertangguh kepada Import Barangan dan Perkhidmatan
27Buletin Suku Tahunan | S4 2021 27
Peluasan Ukuran Liputan Rizab Bagi Import – daripada Import Tertangguh kepada
Import Barangan dan Perkhidmatan
Salah satu penunjuk yang digunakan oleh Bank untuk mengukur kecukupan rizab antarabangsa ialah liputan
rizab bagi import tertangguh,1 yang disiarkan setiap dua minggu. Apabila ekonomi berkembang dengan bahagian
sektor perkhidmatan yang lebih besar, keadaan ini telah meningkatkan kepentingan import perkhidmatan
dalam pengukuran kecukupan rizab. Dengan mengambil kira perkara ini dan selaras dengan amalan terbaik
antarabangsa, laporan rizab antarabangsa Malaysia secara dwimingguan pada masa hadapan akan merangkumi
penunjuk tentang liputan rizab bagi import barangan dan perkhidmatan, berkuat kuasa mulai 22 Februari 2022.2
1 Ditakrifkan sebagai import kasar ditolak dengan eksport semula. Import tertangguh purata 12 bulan boleh didapati daripada Sorotan Bulanan dan Statistik,
Jadual 3.6.8 (Import oleh Pengguna Akhir; lihat Lampiran 1).
2 Bagi kedudukan rizab antarabangsa pada 15 Februari 2022.
3 Ditakrifkan sebagai import ditambah dengan eksport.
4 Daripada RM101.3 bilion kepada RM351.3 bilion, atau kadar pertumbuhan tahunan terkompaun (compound annual growth rate, CAGR) sebanyak 6.4%.
Services tradeC1
0
100
200
300
400
1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021
RM billion
Travel1
Computer and information
Transport
Manufacturing
Other business3
Other2
Perdagangan perkhidmatanR1
0
100
200
300
400
1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021
RM bilion
Perjalanan1
Komputer dan informasi
Pengangkutan
Pembuatan
Perniagaan Lain3
Lain-lain2
Nota: Data sebelum tahun 2005 adalah berdasarkan garis panduan dalam Edisi Kelima Manual Imbangan Pembayaran dan Kedudukan
............Pelaburan Antarabangsa (BPM5) IMF. Data bagi tahun 2005 dan selanjutnya adalah berdasarkan BPM6.
1 Termasuk perbelanjaan perjalanan bagi aktiviti pelancongan.
2 Termasuk pembinaan, caj penggunaan harta intelek, perkhidmatan persendirian, kebudayaan dan rekreasi.
3 Perkhidmatan perniagaan lain termasuk perkhidmatan penyelidikan dan pembangunan, profesional, teknikal, berkaitan perdagangan dan
...perkhidmatan perniagaan lain.
Sumber: Jabatan Perangkaan Malaysia dan Bank Negara Malaysia
Note: Data prior to 2005 are based on the guideline in the Fifth Edition of the Balance of Payments and International Investment Position
............Manual (BPM5) of the IMF. Data for 2005 and beyond are based on BPM6.
1 Includes travel spending for tourism activity.
2 Includes construction, charges for intellectual property use, personal, culture & recreational services.
3 Other business services comprise research and development, professional, technical, trade-related and other business services.
Source: Department of Statistics, Malaysia and Bank Negara Malaysia
Pelaporan Bank berhubung dengan liputan rizab bagi import tertangguh telah diterbitkan seawal tahun 1990-an.
Data bagi import tertangguh tersedia setiap bulan dan oleh itu sangat sepadan dengan siaran kedudukan
rizab antarabangsa setiap dua minggu. Walau bagaimanapun, import tertangguh tidak merangkumi bayaran
untuk perkhidmatan, yang telah berkembang sepanjang dua dekad yang lalu. Dari tahun 1999 hingga 2019,
perdagangan perkhidmatan3 telah meningkat sebanyak 246.9%4 (Rajah 1). Hal ini disebabkan terutamanya
oleh aktiviti pelancongan yang lebih tinggi serta pembayaran untuk perkhidmatan pengangkutan asing bagi
perdagangan barangan. Selain itu, import barangan juga berkembang, sebahagian besarnya bagi menyokong
aktiviti pelaburan dalam negeri dan pengeluaran barangan perkilangan.
28 Buletin Suku Tahunan | S4 202128
Prestasi Malaysia berhubung dengan penunjuk ini selaras dengan ekonomi serantau dan ekonomi yang
setara.5 Data sebelum ini menunjukkan liputan rizab bagi import barangan dan perkhidmatan berada dalam
julat antara lima hingga lapan bulan sejak tahun 2008. Paras ini jauh melebihi nilai ambang yang diterima
pakai secara meluas iaitu tiga bulan. Hal ini menunjukkan keupayaan ekonomi Malaysia untuk bertahan
daripada kejutan luaran.
Penting juga untuk ditekankan bahawa penilaian kecukupan rizab tidak seharusnya berdasarkan semata-
mata nilai muka penunjuk-penunjuk ini. Penilaian ini perlu dilengkapi dengan pemahaman yang mendalam
mengenai kedudukan luaran, sistem kewangan dan dasar ekonomi negara secara am. Khususnya, rizab
antarabangsa bukan sahaja cara untuk memenuhi obligasi luaran.6 Penilaian semasa menunjukkan
kedudukan luaran negara7 disokong oleh asas-asas ekonomi yang utuh termasuk lebihan akaun semasa
yang kukuh, aset luaran mata wang asing yang besar yang dipegang oleh entiti dalam negeri8 dan kadar
pertukaran ringgit yang fleksibel.
Rujukan
Department of Statistics, Malaysia. ‘External Sector’, Jabatan Perangkaan Malaysia, Putrajaya.
Greenspan, A., ‘Currency reserves and debt’. Remarks before the World Bank Conference on Recent Trends in
Reserves Management, Washington, DC, 29 April 1999.
International Monetary Fund, (2016). ‘Guidance Note on the Assessment of Reserve Adequacy and Related
Considerations’.
Lampiran 1: Pengiraan liputan rizab antarabangsa bagi import tertangguh
aSebagai contoh, untuk mengira import tertangguh setiap bulan bagi bulan Disember 2019, import tertangguh
bagi bulan Januari hingga Disember 2019 dicampurkan (iaitu import tertangguh bagi 12 bulan secara berturut-
turut). Jumlah ini kemudiannya dibahagikan dengan 12, bagi mendapatkan purata bulanan. Angka-angka
boleh didapati daripada Jadual 3.6.8, kolum S MHS yang dikeluarkan oleh BNM.
5 Berdasarkan JP Morgan’s Government Bond Index for Emerging Markets.
6 Maklumat lanjut boleh didapati dalam rencana “Daya Tahan Malaysia dalam Mengurus Obligasi Hutang Luar Negeri dan Kecukupan Rizab Antarabangsa” dalam
Laporan Tahunan BNM 2018.
7 Selain itu, turut diberikan penekanan ialah kedudukan hutang luar negeri Malaysia, termasuk hutang luar negeri jangka pendek, yang kekal terurus. Hal ini
disokong oleh profil mata wang dan tempoh matang yang bersesuaian terhadap hutang luar negeri serta daya tahan keupayaan bayaran balik pinjaman oleh
entiti dalam negeri. Hutang luar negeri dalam mata wang asing oleh syarikat-syarikat juga sebahagian besarnya tertakluk pada keperluan berhemat dan lindung
nilai (rujuk penilaian terkini tentang perkembangan hutang luar negeri di halaman [xx])
8 Berjumlah RM1.1 trilion pada akhir tahun 2021.
AR 2023 Press Conference Transcript
PRESS RELEASE
EMBARGO: For immediate release
Bank Negara Malaysia Publishes Annual Report 2023,
Economic and Monetary Review 2023 and
Financial Stability Review for Second Half 2023
Press Conference Presentation Transcript
Introduction
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said,
“Pada sidang akhbar hari ini, Bank Negara Malaysia akan berkongsi analisis
kami tentang pelbagai isu dan perkara yang terkandung dalam laporan kami
iaitu Laporan Tahunan, Tinjauan Ekonomi dan Monetari, serta Tinjauan
Kestabilan Kewangan.
“Analisis ini merangkumi prospek pertumbuhan ekonomi dan inflasi, serta
keadaan kestabilan kewangan negara.
“Sungguhpun dalam persekitaran yang mencabar, ekonomi Malaysia telah
berkembang sebanyak 3.7 peratus pada tahun 2023. Pertumbuhan ini
didorong oleh permintaan domestik yang berdaya tahan dalam keadaan
pertumbuhan global yang lebih perlahan.
“Pada tahun 2024, ekonomi Malaysia dijangka akan bertambah baik.
Permintaan domestik yang terus berkembang dan eksport yang semakin pulih
akan menyokong pertumbuhan ekonomi negara pada tahun ini. Namun
begitu, prospek pertumbuhan ekonomi ini bergantung kepada beberapa risiko
dalam dan luar negeri.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
“Please allow me to continue in English for the benefit of our international
audience.
“Despite the challenging operating environment, the Malaysian economy
expanded by 3.7% in 2023. The growth performance was driven by resilient
domestic demand amid slower global growth.
”For 2024, Malaysia's economy is set to improve. We expect the continued
expansion in domestic demand and the recovery in exports to support
economic growth this year. The outlook, however, remains subject to
downside risks, emanating from both domestic and global factors.”
In 2023, the Malaysian economy expanded by 3.7%
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said, “Let
me begin with a quick recap on the growth performance in 2023. The
Malaysian economy expanded at a moderate pace of 3.7%, supported by a
resilient domestic demand.
“After a strong recovery in 2022, domestic consumption and investment
spending continued to expand in 2023, albeit at a more modest pace. You
would recall that coming out of the pandemic, our economy in 2022 was
boosted by the reopening effects, pent-up demand and massive policy
stimulus, resulting in growth to accelerate to 8.7%.
“On the external front, the slowdown in the global economy and global
technology downcycle impacted manufacturing production as well as exports,
which contracted by 7.9% after a double-digit growth in 2022.”
Global growth to sustain and trade to rebound in 2024
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said,
“Looking ahead, we expect global growth to be sustained in 2024, with a
growth of around 2.7% to 3.2%. We acknowledge the continued headwinds
especially from high interest rates and geopolitics. However, resilient labour
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
markets, trade rebound and moderating inflation will provide crucial support to
growth.
“What is more important to trading nations like Malaysia is the expected strong
rebound in global trade activity from a low growth of 0.4% in 2023 to around
2.9 – 3.4% in 2024. The trade rebound will be driven by the tech upcycle and
increase in tourism activities.”
The Malaysian economy to grow 4.0% - 5.0% in 2024
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said,
“Turning to the domestic economy. We expect the Malaysian economy to grow
between 4% and 5% in 2024. Growth will be driven by household spending,
which is underpinned by higher income growth and continued expansion in
employment.
“Investment activities will be lifted by new and ongoing multi-year projects by
both the private and public sectors, as well as implementation of projects
related to the national master plans.”
“The external sector is expected to benefit from the rebound in global trade
and technology upcycle. Higher tourist arrivals and spending will also provide
additional impetus to our growth.”
Household spending underpinned by improving income
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said,
“Household spending remains the anchor of overall growth, and is projected to
expand at a faster pace of 5.7%. This is based on two key factors. First, as
shown in the middle chart, the higher spending will be driven by better income
growth, supported by stronger external demand, improving tourism activity and
higher productivity.”
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
It is also driven by favourable labour market conditions, with additional
policy support
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said,
“Second, indications are that labour market conditions will remain favourable.
In particular, continued employment growth and low unemployment will
support household spending. As shown in the slide, unemployment rate is
expected to moderate to 3.3% in 2024.
“In addition, targeted policy assistance to households will also lift spending.
These measures include those aimed at raising employment and providing
direct income support. These factors will help cushion the impact of higher
cost of living.”
Investments supported by new and ongoing multi-year projects and
implementation of national master plans will contribute to growth
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said,
“Investment is expected to expand by 6.2%, supported by new and ongoing
multi-year projects in both public and private sectors. Of significance,
realisation of approved investment is well on track, with 74% of approved
manufacturing projects between 2021 and 2023 currently in various stages of
implementation.
“Investment would also benefit from capital expenditure in areas promoted by
key national master plans such as digitalisation and renewable energy.”
Services and manufacturing to be the key driver of growth in 2024
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said,
“Turning to the supply side. The services and manufacturing sectors will
continue to be the main driver of growth in 2024. The services sector,
particularly consumer-related subsectors, will benefit from tourism activities
and favourable labour market conditions. The business-related subsectors will
be supported by better trade and construction activities.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
“Manufacturing sector is expected to grow at a stronger pace. This will be
driven by expansion in the E&E cluster amid the global tech cycle rebound.
Improvement in regional economies will also benefit non-E&E exports. In
addition, resource-based manufacturing will be supported by better upstream
supply conditions.
“However, the agriculture sector is expected to register a small contraction due
to the impact from El Niño and previous years’ under-fertilisation of crops.”
Rebound in global trade, technology cycle and tourism to provide
impetus to Malaysia’s export growth
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said,
“Moving to the external sector. Exports are expected to turn around and record
positive growth, supported by better global demand. As shown in earlier slide,
following the slow growth in 2023, global trade is projected to rebound in 2024.
Global semiconductor sales are forecasted to grow strongly by 13.1% in 2024.
“This will support the recovery of Malaysia’s E&E exports going forward.
Furthermore, the continued recovery in tourist arrivals will also support
Malaysia’s travel receipts and exports of services.”
Current account surplus to improve to 1.8% – 2.8% of GDP in 2024
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said,
“The current account of the balance of payments is expected to improve and
record a higher surplus in 2024. This will be driven mainly by, first, higher
goods surplus, and secondly, lower services deficit following continued
improvement in inbound tourism.”
The growth outlook remains subject to downside risks
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said,
“The growth forecast of 4% to 5% is subject to risks coming from both global
and domestic factors.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
“Downside risks include weaker-than-expected global growth, further
escalation of geopolitical conflicts, and more severe shocks on commodity
production due to extreme weather events.
“There are also upside risks stemming mainly from greater spillovers from the
global technology upcycle and more robust tourism activity. Additional upside
could also arise from faster implementation of existing and new investment
projects by both the public and private sectors.”
In 2023, disinflation was broad-based amid easing cost environment and
stabilising demand conditions
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said,
“Now let me turn to inflation.
“In 2023, headline inflation moderated to 2.5% from 3.3% in 2022, as cost
conditions eased and domestic demand stabilised. Underlying inflation, as
measured by core inflation, also began to trend lower in the second half of
2023. This downtrend was also observed across a range of alternative
measures of underlying inflation, affirming that the disinflation was broad-
based across the CPI basket.
“For more in-depth look at the underlying inflation dynamics in Malaysia,
please have a read of our EMR box article on ‘Underlying Inflation at its Core’.
The box article provides a detailed analysis on various underlying inflation
measures used by Bank Negara Malaysia, and how these measures help to
inform the setting of monetary policy in line with medium-term price stability.
Headline inflation to average between 2.0% and 3.5% in 2024
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said, “In
terms of inflation outlook, headline inflation is expected to average between
2.0% and 3.5% in 2024. The wider forecast range accounts for some upside
impact on inflation from the implementation of subsidy rationalisation.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
“Core inflation is expected to remain moderate in 2024, averaging between
2.0% and 3.0% for the year, broadly reflecting stable demand conditions and
contained cost pressures.”
Risks to the inflation outlook remain tilted to the upside
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said,
“Nevertheless, the outlook for inflation remains highly subject to upside risks
from both domestic policy factors and external forces.
“Domestically, upside risk to the inflation outlook mainly stems from the impact
of the implementation of domestic policy on subsidies and price controls. The
overall impact to inflation would be dependent on the magnitude and timing of
fuel price adjustments, as well as any additional mitigating measures such as
targeted cash transfers.
“Externally, continued pressures from the exchange rate and risks to global
commodity prices could fuel additional cost-push inflation. Nonetheless,
weaker-than-expected global growth conditions could lead to more subdued
global commodity prices, which would place downward pressure on domestic
inflation.”
Monetary policy remains focused on maintaining price stability to
facilitate sustainable domestic economic growth
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said,
“For 2024, monetary policy remains focused on maintaining price stability to
facilitate sustainable economic growth.
“Monetary policy will continue to be forward-looking, and informed by the
MPC’s assessment of the prospects of domestic inflation and growth. Our
baseline forecast is for Malaysia’s growth to improve and inflation to remain
moderate. This provides an appropriate environment for implementing key
structural policies that are needed to further enhance Malaysia’s growth
potential and prospects.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
“The effects of these policies, including the subsidy rationalisation, will be
assessed to discern the short-to-medium term impact on domestic inflation
and growth.
“Beyond domestic policies, the MPC is mindful of other potential risks to
domestic inflation and growth prospects, including from global factors.
Monetary policy decisions will remain guided by the MPC’s assessment of the
balance of risks to domestic inflation and economic growth outlook.
“Amid the evolving economic landscape, our monetary policy approach going
forward will continue to be data-driven. The MPC remains vigilant to ongoing
developments, and their implications to Malaysia's inflation and growth
outlook.”
Greater policy rate increases in other countries have affected the ringgit
against other currencies
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said,
“Greater policy rate increases in other countries relative to Malaysia is one of
the main factors causing the depreciation of the ringgit against other
currencies.
“If we look at the blue bars on the left, other countries have increased their
interest rates more aggressively than Malaysia since 15 March 2022.
Malaysia’s magnitude of OPR increase of 125 basis points is indicated with a
vertical dashed line. The orange bars on the right show the ringgit depreciating
against the corresponding currencies.
“For example, the US has increased its policy rate by 525 basis points from
0.25% to 5.50% since 15 March 2022. Meanwhile, the OPR has only
increased by 125 basis points, from 1.75% to 3.00% over the same period.
This greater magnitude of US policy rate increases compared to that of the
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
OPR is associated with a depreciation of the ringgit against the US dollar by
10.5% as of March 15, 2024.”
Going forward, global and domestic factors are expected to support
a gradual recovery of the ringgit in 2024
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said,
“The decline in the value of the ringgit is temporary and due to external factors.
Since the beginning of 2024, the ringgit has depreciated from RM4.60/USD to
RM4.79/USD on February 20. However, the ringgit has recovered to
RM4.70/USD, as of March 15.
“Looking ahead, financial markets expect the ringgit to appreciate further into
2024 and continue on an appreciating trend as the effect of global factors
subside. Some analysts have projected further into 2025 and assess the
ringgit to continue strengthening. This is supported by a number of factors: A
reduction in the US policy rate during the year is expected to ease the
pressure on the ringgit and other currencies.
“In addition, the recovery in the growth of regional countries is also expected to
increase inflows into the region, benefiting Malaysia and the ringgit.
Furthermore, in the domestic market, the favourable economic outlook and the
implementation of structural reforms are expected to provide support to the
ringgit.
“Nevertheless, we remain vigilant of factors that could increase the risk of a
decline in the ringgit, such as China's slow growth momentum and moderation
in global commodity prices.”
While ringgit is affected by cyclical factors, growth prospects and sound
fundamentals suggest the currency is undervalued
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said,
“There are different factors that can affect the movements of ringgit over the
short- and long- term. In the short-term, ringgit performance is mainly affected
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
by cyclical factors including interest rate differentials, fluctuations in the global
economic conditions, and changing investor sentiments.
“However, in the long-term, ringgit exchange rates are more anchored by
domestic fundamental determinants. In this respect, Malaysia’s economic
fundamentals are sound, as evident from key indicators in 2023 and the
projections for 2024. This lends support to our assessment that the ringgit is
currently undervalued. Our economy is currently diversified with a strong
external sector resilience and sound financial sector.
“In the longer term, structural reforms which can help to improve Malaysia’s
economic prospects will also provide more enduring support to the ringgit.
Nonetheless, BNM has and will continue to take concerted measures to
manage short-term pressure on the ringgit. This includes: Intensified efforts to
encourage repatriation and conversion of foreign investment income by GLCs
and GLICs; Stepping up discussions with corporates and investors; and
Monitoring conversion behaviour of domestic exporters and importers and
engaging them on any unusual trends that we observe.”
Growth in credit to private non-financial sector to remain supportive of
economic activity
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said,
“Credit to private non-financial sector has continued to expand at a steady
pace of 4.8% in 2023, 2022 was 4.7%), in line with the continued expansion of
the Malaysian economy.
“Notably, credit to household improved to 5.6%, 2022 was 5.4%, supported by
improvement in employment and income.
“Moving forward, financing conditions are expected to remain supportive of
financing needs of the economy, underpinned by banks’ strong capacity and
continued willingness to lend.”
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Banks remain supportive of SMEs’ financing needs
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said,
“Financing by banks and DFIs continued to support SMEs’ business needs in
2023, with outstanding financing growing at 8.2%.
“In 2023, SME financing approvals and disbursements for working capital and
investments have remained high due to improved business conditions and a
positive economic outlook.
“We have also observed financing to strategic sectors growing by 23% in
2023, driven mainly by ICT sub-sector. The accelerated growth is closely
aligned with the National Investment Aspirations initiatives and will contribute
towards increasing the value-add of SME’s business activities.”
Banks are well-positioned to support financial intermediation even under
severe simulated downside scenarios
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said,
“Banks in Malaysia remained resilient, with healthy levels of capital and
liquidity buffers that continue to support credit intermediation to the economy.
“We also continue to test the resilience of our Financial Institutions through our
annual stress test exercise, where our banks are subjected to operating
environment scenarios that are more severe than those observed during the
Global Financial Crisis and 2020 pandemic crisis. Our stress test this year
captures additional downside risks, including a liquidity stress test for our
banks.
“The stress test results reaffirm that our banks are sound, with total capital
ratio remaining well above the minimum requirement of 8% under adverse
scenarios.”
Businesses and households’ repayment capacity is preserved,
supported by resilient domestic demand and improving labour market
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said,
“The credit risk outlook for businesses and households continues to improve,
supported by sustained economic growth and improving labour market
conditions.
“Moving forward, borrowers’ repayment capacity will continue to be supported
by households and borrowers' resilient financial positions, favourable labour
market conditions and sound lending standards. Government support
remained available for vulnerable households while viable business and
household borrowers will continue to have access to loan repayment
assistance.”
Financial capability and inclusion are crucial for improving financial well-
being, particularly for the vulnerable population
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said,
“The Bank continues to undertake measures to advance financial capability
and inclusion, with the end-goal of enhancing the overall financial well-being of
all Malaysians.
“In today’s complex and dynamic financial landscape, the Financial Inclusion
Framework 2023 to 2026 shifts the focus of financial inclusion from
accessibility to pursuing broader developmental outcomes.
“The Bank is developing appropriate KPIs to evaluate financial inclusion
strategies against the Framework’s desired outcomes, which will be published
in 2024. To achieve these outcomes, the industry’s commitment and efforts to
spur innovation and foster a wide range of financial choices for consumers are
crucial.
“The measurement and evaluation of financial education initiatives are also
being enhanced through the Financial Education Network or FEN’s annual
baseline KPIs and the Financial Education Measurement and Evaluation
(FEME) Framework, to foster meaningful financial inclusion. This will enable
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
FEN to prioritize and design financial literacy initiatives that deliver the
intended outcomes efficiently and effectively.”
Financial sector accelerating support for businesses to transition
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said,
“We see further progress made by financial institutions on the sustainability
front. More than RM240 billion has been committed by banks for ESG
financing up to 2027. We also saw more financial products and services being
offered such as sustainability-linked financing and protection cover for electric
vehicles and solar PV units.
“The JC3 (Joint Committee on Climate Change) has also actively developed
tools, guidance and frameworks for both financial institutions and businesses.
This includes the SME ESG Jumpstart portal developed last year as a one-
stop centre with tools and information that provide step-by-step approach for
SMEs to kickstart their transition journey.
“The Greening Value Chain pilot introduced last year has trained more than
330 SMEs to begin measuring their greenhouse gas emissions. Of this, 46
SMEs have begun to report such data.”
Islamic finance continues to contribute to the Malaysian economy
through value-based finance
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said,
“There is significant potential to optimise Islamic finance in supporting
Malaysia’s economic transformation and building social resilience through
impactful financial solutions.
“The Bank remains committed to support advancement of value-based finance
in the overall financial system, and this will require collective and steadfast
commitment from all stakeholders to measure beyond profit and improve
financial practices.”
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Sustained 'whole-of-nation' approach required to preserve confidence in
digital payments
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said,
“Turning to the issue of financial scams. Online fraud and the way scammers
operate will continue to evolve. So, we must be persistent in combatting fraud.
This requires a whole-of-nation approach, and everyone needs to play their
part including the government, financial sector, law enforcement agencies and
the users themselves.
“For 2024, we have identified several initiatives to strengthen fraud prevention
and enhance customer protection for victims. This will also be supported by
continuous nationwide awareness program on scams.
“On the enforcement front, the National Fraud Portal (NFP) is set to be
launched by 1H 2024. The National Scam Response Centre’s (NSRC) existing
capabilities will be enhanced through process automation and robust
assessment on mule accounts with the NFP. This will enable the tracing of
stolen funds and the initiation of legal actions to be made more effectively.”
Structural reforms are crucial to ensure stronger and more sustainable
economic growth
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said, “Let
me now touch on long-term priorities. As most of us already know, there are
long standing structural issues with persistent pain points affecting Malaysia.
Hence, undertaking continuous structural reforms are key in ensuring more
sustainable growth and prosperity in the future.
“The positive growth trajectory and moderate inflation this year presents a
window of opportunity for implementation of structural reforms. However, as
these reforms would entail short-term costs, they must be strategically
sequenced and supplemented by targeted assistance to minimise the burden
on households and businesses.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
“The reforms which should be prioritised include: Expedite the implementation
of the various master plans; Develop a future-ready workforce through labour
market reforms; Strengthen social protection programmes; and remain
steadfast on commitment in undertaking fiscal reforms. The execution of these
reforms will raise our competitiveness, ensure more sustainable growth and
improve our standard of living.”
Bank Negara Malaysia: Financial position remained sound in 2023
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said,
“The Bank’s financial position continued to remain sound. For the financial
year ended December 2023, the Bank recorded a net profit of RM7.16 billion,
an increase of 2.5% compared to 2022. Of this, RM 2.85 billion will be paid as
dividends to the Government. In terms of total assets, International Reserves
continued to account for the bulk of the assets at 83%.”
16 box articles across AR, EMR and FSR publications cover various
themes and issues
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said,
“Finally, I would like to draw your attention to our box articles. There are a few
here which I would like to highlight as they provide insights into key interesting
topics. The first two articles on monetary policy and inflation are closely related
to the Bank’s mandate and will give greater understanding on the Bank’s
policy formulation.
“The article on Sustainability will be an important one, especially for
businesses to gain a deeper understanding of key initiatives the financial
sector has introduced to assist SMEs to transition. Meanwhile, the article on
‘Realising Value-based Intermediation (VBI) Vision: Five Years After
Introduction’ delves deeper into the progress on the implementation of VBI
since its introduction.
“We have a total of 16 analytical box articles this year across our three
publications. Please do give them a read! You can find them on our website.”
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Summary
Bank Negara Malaysia Governor Datuk Abdul Rasheed Ghaffour said, “I
have reached the end of my presentation, so allow me to summarise.
“The Malaysian economy is projected to grow by 4% to 5% in 2024 supported
by resilient domestic demand. Meanwhile, the recovery in exports will be
underpinned by stronger global trade, technology upcyle and further
improvement in tourism activity.
“Headline and core inflation are expected to average between 2.0% and 3.5%,
and 2.0% to 3.0%, respectively.
“The banking sectors’ capital and liquidity positions remain strong and
continue to support economic activities.
“Finally, with the positive macroeconomic prospects, this presents a window of
opportunity to undertake reforms. It will be imperative to prioritise and
implement the key structural reforms to ensure growth in the Malaysian
economy becomes stronger and more sustainable going forward.
Bank Negara Malaysia
20 March 2024
| Press Release |
16 Mar 2024 | Inaccurate Ringgit Exchange Rate Data Published Again on Google | https://www.bnm.gov.my/-/goog-err-150324 | null | null |
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Inaccurate Ringgit Exchange Rate Data Published Again on Google
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Saturday, 16 March 2024
16 Mar 2024
Bank Negara Malaysia (BNM) firmly dismisses the inaccurate ringgit exchange rate data that has been circulating on social media based on an erroneous USD/MYR exchange rate published by Google on 15 March 2024. This is an inaccurate information that does not reflect the actual trading.Chart 1: Inaccurate USD/MYR published by Google on 15 March 2024
Yesterday (15 March 2024), the USD/MYR was quoted at 4.7015 at 9 a.m. and 4.7045 at 5 p.m. with an intraday high of 4.7075 in the onshore interbank market for ringgit, as published on the BNM website.
In the past two weeks (1 - 15th March 2024), the ringgit has strengthened 0.76% against the US dollar.
Table 1: USD/MYR exchange rate published on BNM website
Source: USD/MYR Interbank Intraday Rate
This is the second incident that Google has published an inaccurate USD/MYR exchange rate data in 2024. BNM had earlier issued a stern warning letter to Google when the first misreporting occurred on 6 February 2024. As this is the second instance of misreporting, BNM will be engaging Google for an explanation of how the inaccurate reporting occurred and the corrective measures taken given that this is a recurring issue that has afflicted Malaysia and other countries in the past few months.
Members of the public are advised to rely on official data, including from BNM. Members of the public should also exercise caution against using, circulating or speculating on unverifiable sources as a reference for the ringgit. The exchange rate is a market-sensitive data and any inaccurate reporting and circulation of unverified data can cause serious implications for the financial markets.
Bank Negara Malaysia
16 March 2024
See also:
Press Release on 6 February 2024 on Inaccurate Ringgit Exchange Rate Data Published
Ringgit Exchange Rate Daily Data
USD/MYR Interbank Intraday Rate
Ringgit Exchange Rate Frequently Asked Questions (FAQ)
© Bank Negara Malaysia, 2024. All rights reserved.
| null | Press Release |
07 Mar 2024 | Monetary Policy Statement | https://www.bnm.gov.my/-/monetary-policy-statement-07032024 | https://www.bnm.gov.my/documents/20124/13718816/MPS_Snapshot_2024_03_en.pdf | null |
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Monetary Policy Statement
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8
Monetary Policy Statement
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1500 on
Thursday, 7 March 2024
7 Mar 2024
At its meeting today, the Monetary Policy Committee (MPC) of Bank Negara Malaysia decided to maintain the Overnight Policy Rate (OPR) at 3.00 percent.
The global economy continues to expand albeit moderately, supported by domestic demand amid improvement in trade activity. Favourable labour market conditions in some countries continue to support consumption activity. Looking ahead, growth in regional economies is expected to improve, while China’s growth would likely remain modest given continued weakness in the property market. Global trade is expected to strengthen as the global tech upcycle gains momentum. Global headline and core inflation edged downwards in recent months with prospects of monetary easing in some countries in the second half of the year. Nonetheless, the global monetary policy stance is likely to remain tight in the near term, as inflation remains above average. The growth outlook remains subject to downside risks, mainly from an escalation of geopolitical tensions, higher-than-anticipated inflation outturns, and volatility in global financial markets.
The Malaysian economy expanded by 3.7% in 2023. Moving forward, growth is expected to improve in 2024, driven by the recovery in exports and resilient domestic expenditure. Export growth is turning positive after contracting since March 2023 and will continue to be supported by stronger global trade. Tourist arrivals and spending are poised to rise further. Continued employment and wage growth remain supportive of household spending. Investment activity would be supported by the ongoing progress of multi-year projects in both the private and public sectors, the implementation of catalytic initiatives under the national master plans, as well as the higher realisation of investments. The growth outlook is subject to downside risks stemming from weaker-than-expected external demand and larger declines in commodity production. Meanwhile, upside risks to growth mainly emanate from greater spillover from the tech upcycle, more robust tourism activity and faster implementation of existing and new projects.
Headline and core inflation stood at 1.5% and 1.8% respectively in January 2024, trending in line with expectations. Inflation in 2024 is expected to remain moderate, broadly reflecting stable demand conditions and contained cost pressures. However, this outlook continues to be highly dependent on the implementation of domestic policy on subsidies and price controls, as well as global commodity prices and financial market developments.
The ringgit is currently undervalued, given Malaysia's economic fundamentals and growth prospects. The Government and Bank Negara Malaysia are taking coordinated actions to encourage repatriation and conversion of foreign investment income by Government-Linked Companies (GLCs) and Government-Linked Investment Companies (GLICs). These actions are contributing to greater inflows, lending support to a firmer ringgit. Over the medium term, ongoing structural reforms will provide more enduring support to the ringgit.
At the current OPR level, the monetary policy stance remains supportive of the economy and is consistent with the current assessment of the inflation and growth prospects. The MPC remains vigilant to ongoing developments to inform the assessment on the outlook of domestic inflation and growth. The MPC will ensure that the monetary policy stance remains conducive to sustainable economic growth amid price stability.
See also:
Monetary Policy Statement (MPS) Snapshot: March 2024
Frequently Asked QuestionsBank Negara Malaysia
7 March 2024
© Bank Negara Malaysia, 2024. All rights reserved.
|
Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to Imports of Goods and Services
27Quarterly Bulletin | 4Q 2021
Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to
Imports of Goods and Services
One of the indicators used by the Bank to measure international reserve adequacy is the reserve coverage
of retained imports,1 which is communicated on a fortnightly basis. As the economy grew and evolved with
higher share of the services sector, this has raised the prominence of services imports in the measure of
reserve adequacy. Given this consideration and in line with the international best practice, future fortnightly
reporting of Malaysia’s international reserves will include the indicator on reserve coverage of imports of
goods and services, effective from 22 February 2022.2
1 Defined as gross imports subtracted with re-exports. The 12-month average retained imports can be derived from the Monthly Highlight and Statistics Table
3.6.8 (Imports by End-Use; see Appendix 1).
2 For the international reserves position as at 15 February 2022.
3 Defined as imports plus exports.
4 From RM101.3 billion to RM351.3 billion, or a compound annual growth rate (CAGR) of 6.4%.
5 Based on JP Morgan’s Government Bond Index for Emerging Markets.
Services tradeC1
0
100
200
300
400
1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021
RM billion
Travel1
Computer and information
Transport
Manufacturing
Other business3
Other2
Perdagangan perkhidmatanR1
0
100
200
300
400
1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021
RM bilion
Perjalanan1
Komputer dan informasi
Pengangkutan
Pembuatan
Perniagaan Lain3
Lain-lain2
Nota: Data sebelum tahun 2005 adalah berdasarkan garis panduan dalam Edisi Kelima Manual Imbangan Pembayaran dan Kedudukan
............Pelaburan Antarabangsa (BPM5) IMF. Data bagi tahun 2005 dan selanjutnya adalah berdasarkan BPM6.
1 Termasuk perbelanjaan perjalanan bagi aktiviti pelancongan.
2 Termasuk pembinaan, caj penggunaan harta intelek, perkhidmatan persendirian, kebudayaan dan rekreasi.
3 Perkhidmatan perniagaan lain termasuk perkhidmatan penyelidikan dan pembangunan, profesional, teknikal, berkaitan perdagangan dan
...perkhidmatan perniagaan lain.
Sumber: Jabatan Perangkaan Malaysia dan Bank Negara Malaysia
Note: Data prior to 2005 are based on the guideline in the Fifth Edition of the Balance of Payments and International Investment Position
............Manual (BPM5) of the IMF. Data for 2005 and beyond are based on BPM6.
1 Includes travel spending for tourism activity.
2 Includes construction, charges for intellectual property use, personal, culture & recreational services.
3 Other business services comprise research and development, professional, technical, trade-related and other business services.
Source: Department of Statistics, Malaysia and Bank Negara Malaysia
The Bank’s reporting of the reserve coverage of retained imports was published as early as in the 1990s. Data
on retained imports are available on monthly basis and thereby closely match the fortnightly release of the
international reserves data. However, retained imports do not include payment for services, which has grown
over the past two decades. From 1999 to 2019, services trade3 has increased by 246.9%4 (Chart 1). This was
mainly due to higher tourism activity as well as payments for foreign transport services for goods trade. In
addition, there was also an expansion in goods import, largely in support of domestic investment activities
and production of manufactured goods.
Malaysia’s performance on this indicator is in line with regional and peer5 economies. On historical basis,
reserve coverage of imports of goods and services indicator has been in the range of between 5 and 8
months since 2008 – well above the generally-accepted ‘rule of thumb’ adequacy threshold of 3-months, and
demonstrates the ability of the Malaysian economy to withstand against external shocks.
28 Quarterly Bulletin | 4Q 2021
It is also important to emphasize that the assessment of reserve adequacy should not be solely based
on the face value of these indicators. This needs to be complemented with deeper understanding about
the country’s external position, financial system and broad economic policies. In particular, international
reserves is not the only means to meet external obligations.6 Prevailing assessment indicates that the
country’s external position7 is underpinned by its strong economic fundamentals including healthy current
account surplus, large foreign currency external assets held by domestic entities8 and the flexible ringgit
exchange rate.
References
Department of Statistics, Malaysia. ‘External Sector’, Jabatan Perangkaan Malaysia, Putrajaya.
Greenspan, A., ‘Currency reserves and debt’. Remarks before the World Bank Conference on Recent Trends in
Reserves Management, Washington, DC, 29 April 1999.
International Monetary Fund, (2016). ‘Guidance Note on the Assessment of Reserve Adequacy and Related
Considerations’.
Appendix 1: Calculation of international reserves coverage of retained imports
aFor example, to calculate monthly retained imports for December 2019, the retained imports for the months of
January to December 2019 is summed up (i.e. rolling 12-months of retained imports). This number is then divided
by 12, to obtain a monthly average. The figures can be obtained from BNM’s MHS Table 3.6.8, column S.
6 Further information can be found in the box article “Malaysia’s Resilience in Managing External Debt Obligations and the Adequacy of International Reserves”
in BNM’s Annual Report 2018.
7 In addition, it has also been emphasized that Malaysia’s external debt position, including short-term external debt, remains manageable. This is supported by
the favourable currency and maturity profile on its external debt as well as domestic entities’ resilient repayment capacity. Foreign-currency external debt of
corporates are also mainly subject to prudential and hedging requirements (refer to the latest assessment on external debt developments on page 25)
8 Amounting to RM1.1 trillion as at end-2021.
| Press Release |
07 Mar 2024 | International Reserves of Bank Negara Malaysia as at 29 February 2024 | https://www.bnm.gov.my/-/international-reserves-of-bank-negara-malaysia-as-at-29-february-2024 | https://www.bnm.gov.my/documents/20124/6118085/qb2021q4_en_box_imports.pdf | null |
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International Reserves of Bank Negara Malaysia as at 29 February 2024
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International Reserves of Bank Negara Malaysia as at 29 February 2024
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7 Mar 2024
The international reserves of Bank Negara Malaysia amounted to USD114.3 billion as at 29 February 2024. The reserves position is sufficient to finance 5.4 months of imports of goods and services[1] and is 1.0 times of the total short-term external debt.
[1] Under the previous import coverage measure, reserves is sufficient to finance 6.8 months of retained imports of goods. For more information on the new indicator, please refer to the article on “Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to Imports of Goods and Services” in BNM’s Quarterly Bulletin for the Fourth Quarter of 2021 publication, page 27, which can be accessed at bnm.gov.my/-/quarterly-bulletin-4q-2021 Related Assets
BNM Statement of Assets & Liabilities - 29 February 2024
Bank Negara Malaysia
7 March 2024
© Bank Negara Malaysia, 2024. All rights reserved.
|
Monthly Highlights
Headline inflation declined to 3.4% in March
March 2023
1
3.7 3.4
3.9 3.8
0.00
2.00
4.00
0.0
2.0
4.0
J
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2
F
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2
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2
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2
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2
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2
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-2
2
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2
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2
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2
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-2
3
M
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2
3
Food & non-alcohol (29.5%) Housing & utilities (23.8%)
Transport (14.6%) Others (32.1%)
Headline inflation (RHS) Core inflation¹ (RHS)
Contribution to Inflation
ppt. contribution %, yoy
1 Core inflation is computed by excluding price-volatile and price-administered items.
Source: Department of Statistics, Malaysia & Bank Negara Malaysia estimates
• Headline inflation declined to 3.4% in March
(February: 3.7%) due mainly to lower inflation for
fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation moderated slightly to 3.8% during
the month (February: 3.9%), driven largely by
lower inflation for food away from home.
1
Robust growth in volume index driven by retail and motor vehicles
Index of Wholesale and Retail Trade
Source: Department of Statistics, Malaysia
• The Index of Wholesale and Retail Trade
(IOWRT) expanded by 10.6% in February 2023
(January: 8.5%).
• The higher growth was driven mainly by retail
sales in non-specialised stores (e.g., department
stores) followed by continued strength in
purchases of motor vehicles amid the ongoing
fulfilment of backlog orders.
• On a month-on-month seasonally adjusted basis,
the index accelerated by 5.5% (January: 0.2%).
9.5 8.510.6
0
10
20
30
40
Feb-
22
Mar-
22
Apr-
22
May-
22
Jun-
22
Jul-
22
Aug-
22
Sep-
22
Oct-
22
Nov-
22
Dec-
22
Jan-
23
Feb-
23
ppt, %yoy
Motor vehicles Retail Wholesale
2.4
5.2
4.4
0
1
2
3
4
5
6
7
Mar-22 Jul-22 Nov-22 Mar-23
Business loans
Household loans
Corporate bonds
Annual growth (%)
Growth in credit to the private non-financial sector moderated
1 Comprises loans to households and non-financial corporations from the
banking system and development financial institutions (DFIs), and corporate
bonds issued by non-financial corporations (including short-term papers).
2 Starting with the publication of December 2022 Monthly Highlights and
Statistics (MHS), this series was introduced to enhance the quality of
financing data. This new data series is available in the MHS Table 2.18.
Source: Bank Negara Malaysia
2.7 2.6 2.7 2.6
1.0 0.6 0.7 0.7
1.0
1.1 1.1 0.9
4.7 4.3 4.5 4.2
Dec-22 Jan-23 Feb-23 Mar-23
Corporate Bonds
Business Loans
Household Loans
Credit to the Private Non-
Financial Sector
Contribution to growth (ppt)
• Credit to the private non-financial sector grew by
4.2% as at end-March (February: 4.5%), attributed
to slower growth in credit to businesses (3.2%;
February: 3.7%).
• While growth in outstanding corporate bonds
moderated (4.4%; February : 5.5%), outstanding
business loan growth was sustained at 2.4%
(February: 2.4%). This was supported by the
continued growth in both working capital (2.2%;
February: 1.9%) and investment-related loans
(4.3%; February: 4.2%).
• Outstanding household loan growth remained
broadly stable (5.2%; February: 5.3%), supported
by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan
growth for the purchase of securities (-6.9%;
February: -3.3%).
Credit to the Private Non-Financial Sector1,2
Monthly Highlights
March 2023
Domestic financial market conditions remained orderly
Financial Market Performance in March 2023
Source: Bank Negara Malaysia, Bursa Malaysia
Note: The exchange rate data is the noon-rate in the Kuala Lumpur Interbank Foreign Exchange Market
11.0
-2.1
-5.3
0.0
-2.2
1.7
10-year MGS
(bps, mom)
Equity
(%, mom)
Ringgit
(%, mom)
-10 -5 0 5 10 15
Mar-23
Feb-23
• In March, global financial markets were affected by
the emergence of banking sector stress in some
major economies. As spillovers were contained thus
far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds
improved.
• In line with the performance of regional currencies,
the ringgit appreciated by 1.7% against the US
dollar. Conditions in the domestic bond market
also remained stable.
• The FBM KLCI declined by 2.2% during the month.
2
Banks maintained strong liquidity and funding positions to support intermediation
Source: Bank Negara Malaysia
Banking System Liquidity and Funding Ratios
81.9
157.4
0
40
80
120
160
70
75
80
85
90
95
M
a
r
2
2
A
p
r
2
2
M
a
y
2
2
J
u
n
2
2
J
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2
2
A
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2
2
S
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2
2
O
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2
2
N
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2
2
D
e
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2
2
J
a
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2
3
F
e
b
2
3
M
a
r
2
3
% %
Liquidity Coverage Ratio (RHS)
Loan-to-Fund Ratio
Asset quality in the banking system remained intact
Banking System Asset Quality
Source: Bank Negara Malaysia
• Overall gross and net impaired loans ratios
increased slightly to 1.8% (February-23: 1.8%) and
1.2% (February-23: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory
reserves) continue to record a prudent level of
110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
%
1.8
1.2
1.7
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
M
a
r
2
2
A
p
r
2
2
M
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2
2
J
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2
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2
2
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2
3
F
e
b
2
3
M
a
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2
3
Gross Impaired Loans Ratio
Total Provisions to Total Loans Ratio
Net Impaired Loans Ratio
• Banks continued to record healthy liquidity buffers
with the aggregate Liquidity Coverage Ratio at
157.4% (February-23: 152.7%).
• The aggregate loan-to-fund ratio remained stable at
81.9% (February-23: 81.6%).
PRESS RELEASE
Ref. No.: 04/23/05 EMBARGO: Not for publication or
broadcast before 1500 hours on
Friday, 28 April 2023
Monthly Highlights – March 2023
Headline inflation declined to 3.4% in March
• Headline inflation declined to 3.4% in March (February: 3.7%) due mainly
to lower inflation for fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation1 moderated slightly to 3.8% during the month
(February: 3.9%), driven largely by lower inflation for food away from
home.
Robust growth in volume index driven by retail and motor vehicles
• The Index of Wholesale and Retail Trade (IOWRT) expanded by 10.6%
in February 2023 (January: 8.5%).
• The higher growth was driven mainly by retail sales in non-specialised
stores (e.g., department stores) followed by continued strength in
purchases of motor vehicles amid the ongoing fulfilment of backlog
orders.
• On a month-on-month seasonally adjusted basis, the index accelerated
by 5.5% (January: 0.2%).
1 Core inflation is computed by excluding price-volatile and price-administered items.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Growth in credit to the private non-financial sector2,3 moderated
• Credit to the private non-financial sector grew by 4.2% as at end-March
(February: 4.5%), attributed to slower growth in credit to businesses
(3.2%; February: 3.7%).
• While growth in outstanding corporate bonds moderated (4.4%;
February: 5.5%), outstanding business loan growth was sustained at
2.4% (February: 2.4%). This was supported by the continued growth in
both working capital (2.2%; February: 1.9%) and investment-related
loans (4.3%; February: 4.2%).
• Outstanding household loan growth remained broadly stable (5.2%;
February: 5.3%), supported by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan growth for the purchase of
securities (-6.9%; February: -3.3%).
Domestic financial market conditions remained orderly
• In March, global financial markets were affected by the emergence of
banking sector stress in some major economies. As spillovers were
contained thus far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds improved.
• In line with the performance of regional currencies, the ringgit
appreciated by 1.7% against the US dollar. Conditions in the domestic
bond market also remained stable.
• The FBM KLCI declined by 2.2% during the month.
Banks maintained strong liquidity and funding positions to support
intermediation
• Banks continued to record healthy liquidity buffers with the aggregate
Liquidity Coverage Ratio at 157.4% (February: 152.7%).
2 Comprises loans to households and non-financial corporations from the banking system and development financial
institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers).
3 Starting with the publication of December 2022 Monthly Highlights and Statistics (MHS), this series was introduced
to enhance the quality of financing data. This new data series is available in the MHS Table 2.18.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
• The aggregate loan-to-fund ratio remained stable at 81.9%
(February: 81.6%).
Asset quality in the banking system remained intact
• Overall gross and net impaired loans ratios increased slightly to 1.8%
(February: 1.8%) and 1.2% (February: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory reserves) continues to
record a prudent level of 110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
Bank Negara Malaysia
28 April 2023
20230428_BNM Monthly Highlights-March_en
Slide 1
Slide 2
20230428_BNM PR_Monthly Highlights-Mar 2023_eng
| Press Release |
01 Mar 2024 | Statement by the Financial Markets Committee on the Ringgit Foreign Exchange Market | https://www.bnm.gov.my/-/fmc-stmt-mar2024 | null | null |
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Statement by the Financial Markets Committee on the Ringgit Foreign Exchange Market
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Statement by the Financial Markets Committee on the Ringgit Foreign Exchange Market
Embargo :
For immediate release
Not for publication or broadcast before
1806 on
Friday, 1 March 2024
1 Mar 2024
The Financial Markets Committee (FMC) convened today to discuss recent developments in the ringgit foreign exchange market.
The meeting concurred with the assessment that the current level of ringgit is deemed undervalued, particularly as Malaysia’s economic fundamentals continue to be strong and the economic prospect is positive.
The FMC welcomes Finance Minister II’s statement on ringgit especially on the intensified coordination between the government and BNM to encourage more inflows into the market. This includes stepping up coordination with government-linked companies (GLCs) and government-linked investment companies (GLICs) to encourage them to repatriate foreign investment income and convert that income into ringgit more consistently, playing their roles to support the ringgit amidst challenging global environment.
The meeting noted that there has been an immediate impact on market flows and increased market interest in buying ringgit. The potential for further conversion to ringgit could be high, given the prevailing level of foreign currency balances onshore. The FMC noted that BNM will enhance engagements with corporates and investors to further encourage conversions and strengthen market sentiment on the ringgit.
The FMC also noted global investors’ continued confidence in the Malaysian financial market. On a YTD basis, the KLCI rose 6.7%, supported by USD422 million inflows from non-resident investors. Long-term government bond holdings by non-residents continued to be stable at around 22% while the FX market remains vibrant with a healthy daily turnover of USD15.3 billion. These will continue to facilitate efficient intermediation in the economy.
Standard Chartered Bank Malaysia’s Head of Treasury, Sylvia Wong notes, “We have seen balanced flows from both corporates and institutional investors as the ringgit continues to be traded in an orderly manner. External factors, namely US rate hike expectations, continue to dictate regional FX movements, including the ringgit. Once US rate cut visibility improves, bilateral exchange rates valuation against the USD should improve.”
Allianz Malaysia Berhad’s Chief Investment Officer, Wong Siew Lin also added, “The positive equity performance YTD has not been observed for a while and the rally has been evidently broad-based in nature. In addition, the main market has outperformed the small-caps this year."
FMC Chairman and Bank Negara Malaysia Deputy Governor, Adnan Zaylani concluded, “It was a good and informative meeting. Based on the insights shared, the prospect for ringgit to strengthen from here is strong.”
About the Financial Markets Committee (FMC)
The FMC is a committee established by BNM in May 2016 and comprises representatives from Bank Negara Malaysia, financial institutions, corporations, financial service providers and other institutions which have prominent role or participation in the financial markets.
Bank Negara Malaysia
1 March 2024
© Bank Negara Malaysia, 2024. All rights reserved.
| null | Press Release |
29 Feb 2024 | Monetary and Financial Developments in January 2024 | https://www.bnm.gov.my/-/monetary-and-financial-developments-in-january-2024 | https://www.bnm.gov.my/documents/20124/13645389/i_en.pdf | null |
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Monetary and Financial Developments in January 2024
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Monetary and Financial Developments in January 2024
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Not for publication or broadcast before
1500 on
Thursday, 29 February 2024
29 Feb 2024
Headline inflation remained unchanged while core inflation [1] continued moderating
Headline inflation remained unchanged at 1.5% in January (December 2023: 1.5%), while core inflation edged lower to 1.8% (December 2023: 1.9%).
Inflation for food and non-alcoholic beverages continued to trend lower during the month, though this was offset by higher inflation for sewerage and RON97 fuel.
Export growth turned positive
Exports turned around to register positive growth (8.7%; December 2023: -10.1%), the first time since March 2023. This is driven by broad-based improvement in both manufactured and commodities exports.
Manufactured exports rebounded, supported by double-digit growth in non-E&E exports and smaller contraction in E&E exports. Meanwhile, commodities exports also improved driven by higher palm oil exports.
Looking ahead, exports are expected to continue on this recovery path throughout 2024. Downside risks remain, stemming from weaker external demand.
Higher growth in credit to the private non-financial sector[2],[3]
Credit to the private non-financial sector grew by 5% as at end-January 2024 (December 2023: 4.7%), supported by higher growth in outstanding loans (5.4%; December 2023: 4.9%).
Outstanding business loan growth increased to 4.2% (December 2023: 3.6%), supported by higher growth in investment-related loans. Of note, growth in outstanding loans to SMEs remained forthcoming (8%; December 2023: 8.2%). Meanwhile, outstanding corporate bonds growth moderated to 3.6% (December 2023: 4.2%).
For households, outstanding loan growth increased to 6% (December 2023: 5.6%), with sustained growth across most loan purposes. This was reflective of the continued demand for loans, especially for the purchase of houses and cars.
Domestic financial markets were primarily influenced by global investors’ expectations for the US policy rate to be higher-for-longer
Global financial conditions were primarily driven by evolving financial market expectations that the US Federal Reserve would keep current elevated policy interest rate for a longer period largely due to the resilience in the US labour market.
Against this backdrop, the ringgit depreciated by 2.9% against the US dollar (regional [4] average: -2.5%), while the 10-year MGS yield increased by 5 bps (regional 4 average: +12 bps).
Nevertheless, FBM KLCI traded higher by 4% amid foreign equity inflows (regional 4 average: -2%).
Banks maintained strong liquidity and funding positions to support intermediation
Banking system continue to record healthy liquidity buffers with the aggregate Liquidity Coverage Ratio at 160.2% (December 2023: 160.9%).
The aggregate loan-to-fund ratio remained broadly stable at 81.6% (December 2023: 81.8%).
Asset quality in the banking system remained intact
Overall gross and net impaired loans ratios remained stable at 1.64% and 1% (December 2023: 1.65% and 1.1%) respectively.
Loan loss coverage ratio (including regulatory reserves) continue to be at a prudent level of 120.8% (December 2023: 119%) of impaired loans, with total provisions accounting for 1.5% (December 2023: 1.5%) of total loans.
[1] Core inflation is computed by excluding price-volatile and price-administered items.
[2] Comprises loans to households and non-financial corporations from the banking system and development financial institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers).
[3] Starting with the publication of December 2022 Monthly Highlights and Statistics (MHS), this series was introduced to enhance the quality of financing data. This new data series is available in the MHS Table 2.18.
[4] Regional countries comprise: Singapore, Thailand, Philippines, Indonesia, and Korea.
Monthly Highlights [PDF] Related Assets
Monthly Highlights & Statistics in January 2024
Bank Negara Malaysia
29 February 2024
© Bank Negara Malaysia, 2024. All rights reserved.
|
Monthly Highlights May 2023
Monthly Highlights
Headline inflation declined further to 2.8% in May
May 2023
Contribution to Inflation
ppt. contribution %, yoy
1 Core inflation is computed by excluding price-volatile and price-administered items.
Source: Department of Statistics, Malaysia & Bank Negara Malaysia estimates
• Headline inflation moderated to 2.8% (April 2023:
3.3%). This decline was largely due to non-core
CPI components, particularly lower inflation for
fuel (-0.2 percentage points, ppt) and fresh food
(-0.1ppt).
• Core inflation also declined slightly to 3.5% (April
2023: 3.6%) amid lower inflation for
communication services.
3.3
2.8
3.6 3.5
0.00
2.00
4.00
0.0
2.0
4.0
J
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-2
2
F
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-2
2
M
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2
2
A
p
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2
2
M
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-2
2
J
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-2
2
J
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2
2
A
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-2
2
S
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-2
2
O
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2
2
N
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-2
2
D
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-2
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J
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-2
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F
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-2
3
M
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2
3
A
p
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2
3
M
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-2
3
Food & non-alcohol (29.5%) Housing & utilities (23.8%)
Transport (14.6%) Others (32.1%)
Headline inflation (RHS) Core inflation¹ (RHS)
1.6
5.1
4.6
0
1
2
3
4
5
6
7
May-22 Sep-22 Jan-23 May-23
Business loans
Household loans
Corporate bonds
Annual growth (%)
Credit to the Private Non-Financial Sector1,2
1
Growth in credit to the private non-financial sector improved in May
1 Comprises loans to households and non-financial corporations from the
banking system and development financial institutions (DFIs), and corporate
bonds issued by non-financial corporations (including short-term papers).
2 Starting with the publication of December 2022 Monthly Highlights and
Statistics (MHS), this series was introduced to enhance the quality of
financing data. This new data series is available in the MHS Table 2.18.
Source: Bank Negara Malaysia
Contribution to growth (ppt)
• Credit to the private non-financial sector expanded
by 4.0% as at end-May (April 2023: 3.7%), driven
mainly by higher growth in credit to businesses
(2.8%; April 2023: 2.5%).
• Outstanding corporate bonds grew by 4.6% (April
2023: 4.4%), while outstanding business loans
expanded by 1.6% (April 2023: 1.0%). The higher
business loan growth reflected improvement in
loans for both working capital and investments to
SMEs and non-SMEs.
• In the household segment, outstanding loan
growth was sustained at 5.1% (April 2023: 5.0%),
supported by higher growth across most loan
purposes. Of note, household loan growth
continued to be driven by loans for the purchase of
houses and cars, which grew by 7.0% and 8.4%,
respectively (April 2023: 6.8% and 8.0%).
2.7 2.6 2.5 2.6
0.7 0.7 0.3 0.5
1.1 0.9
0.9 1.0
4.5 4.2
3.7 4.0
Feb-23 Mar-23 Apr-23 May-23
Corporate Bonds
Business Loans
Household Loans
Credit to the Private Non-
Financial Sector
Index of wholesale and retail trade growth moderated in April
Source: Department of Statistics, Malaysia
• The Index of Wholesale and Retail Trade
(IOWRT) expanded more moderately by 4.7% in
April 2023 (March 2023: 9.4%). The lower growth
was due mainly to the decline in the motor vehicle
segment.
• However, the retail segment continued to record a
double-digit growth of 10.0% (March 2023:
13.8%), supported by sales in non-specialised and
other specialised stores1.
• On a month-on-month seasonally adjusted basis,
the index increased at a faster pace of 6.5%
(March 2023: -0.9%).
1 Other goods in specialised stores includes clothing, footwear,
pharmaceuticals, cosmetics, watches, jewellery and optical goods.
10.6
9.4
4.7
-2
3
8
13
18
23
28
33
Apr-22 Jun-22 Aug-22 Oct-22 Dec-22 Feb-23 Apr-23
ppt, %yoy
Motor vehicles Retail Wholesale
Index of Wholesale and Retail Trade
Monthly Highlights
2
May 2023
Domestic financial markets were largely affected by external factors
Financial Market Performance in May 2023
-18.0
-0.5
-1.1
-3.0
-2.0
-3.4
10-year MGS
(bps, mom)
Equity
(%, mom)
Ringgit
(%, mom)
-20 -15 -10 -5 0
May-23 Apr-23
Note: The exchange rate data is the noon-rate in the Kuala Lumpur Interbank Foreign Exchange Market
1Regional countries comprise Singapore, Thailand, Philippines, Indonesia, and Korea
Source: Bank Negara Malaysia, Bursa Malaysia
• Global investors maintained a risk-off approach
throughout May, as concerns over the impact of the
US debt ceiling crisis and the weaker-than-
expected rebound in China’s economy weighed on
global financial markets.
• As a result, the ringgit depreciated against the US
dollar by 3.4% (regional1 average: -1.2%). Similarly,
the FBM KLCI declined by 2.0% (regional1 average:
-1.3%).
• Nonetheless, the 10-year MGS yields decreased
slightly by 3 basis points, supported by non-resident
inflows into the domestic bond market.
Banks maintained strong liquidity and funding positions to support intermediation
• Banks continued to record healthy liquidity buffers
with the aggregate Liquidity Coverage Ratio at
151.2% (April 2023: 154.3%).
• The aggregate loan-to-fund ratio remained stable at
81.8% (April 2023: 82.1%).
Source: Bank Negara Malaysia
Banking System Liquidity and Funding Ratios
81.8
151.2
0
40
80
120
160
70
75
80
85
90
95
M
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2
2
J
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2
2
J
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2
2
A
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2
2
S
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2
2
O
c
t
2
2
N
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2
2
D
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2
2
J
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2
3
F
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2
3
M
a
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2
3
A
p
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2
3
M
a
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2
3
% %
Liquidity Coverage Ratio (RHS)
Loan-to-Fund Ratio
Asset quality in the banking system remained intact
Banking System Asset Quality
Source: Bank Negara Malaysia
• Overall gross and net impaired loans ratios
remained broadly unchanged at 1.80% (April
2023: 1.78%) and 1.10% (April 2023: 1.10%),
respectively.
• Loan loss coverage ratio (including regulatory
reserves) remained at a prudent level of 114.1%
of impaired loans, with total provisions accounting
for 1.7% of total loans.
%
1.8
1.1
1.7
0.5
1.0
1.5
2.0
M
a
y
2
2
J
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2
2
J
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2
2
A
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2
2
S
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2
2
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N
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2
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D
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2
2
J
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2
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F
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2
3
M
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3
A
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2
3
M
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2
3
Gross Impaired Loans Ratio
Total Provisions to Total Loans Ratio
Net Impaired Loans Ratio
April 2023 Monthly Highlights
Slide 1
Slide 2
| Press Release |
29 Feb 2024 | Joint Statement by Bank Negara Malaysia and Securities Commission Malaysia from the 12th Joint Committee on Climate Change (JC3) Meeting | https://www.bnm.gov.my/-/jc3-mtg12 | null | null |
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Joint Statement by Bank Negara Malaysia and Securities Commission Malaysia from the 12th Joint Committee on Climate Change (JC3) Meeting
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Joint Statement by Bank Negara Malaysia and Securities Commission Malaysia from the 12th Joint Committee on Climate Change (JC3) Meeting
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29 Feb 2024
The Joint Committee on Climate Change (JC3) held its 12th meeting on 23 February 2024 to review the progress of ongoing work and discuss priorities and action plans of JC3 for the year.
In 2024, JC3 will continue to work with the Government, the financial industry and its partners on specific action plans to support a just and orderly transition of the economy. The members endorsed the plans to continue focusing on increasing financial flows for climate transition and adaptation, and building resilience against climate-related risks.
In addition, efforts will be made to integrate a broader consideration of nature and environmental risks with the ongoing development of climate strategies by financial institutions. Building on national policies that have been announced by the Government, JC3 will serve as a key platform to promote the financial sector’s alignment on sectoral transition pathways.
A key focus area in the coming year will be on supporting the financial industry’s development of credible transition plans. This includes work to publish a JC3 Transition Finance Framework to guide the development of credible transition finance solutions.
Datuk Jessica Chew Cheng Lian, Deputy Governor of Bank Negara Malaysia and Co-Chair of JC3, said, “As more financial institutions have set climate targets, it is crucial for financial institutions to develop and execute concrete and credible transition plans that are aligned with these targets. At the macro level, transition plans should reflect and be consistent with national and sectoral pathways. This is important to ensure financial support for transition and adaptation activities and mitigate the effects of short-term dislocations to the economy.”
While appreciating greater visibility on catalyst projects and funding needs under the National Energy Transition Roadmap (NETR) and New Industrial Masterplan (NIMP), members acknowledged the need to expand public-private partnerships and blended finance structures to mobilise capital. Members discussed and agreed to work on potential strategies to achieve this, including sector-focused strategies and data priorities.
In supporting real sector transformation, members noted the positive outcomes from the Greening Value Chain (GVC) pilot programme rolled out a year ago. The programme has enabled more than 330 SMEs to start measuring and reporting their greenhouse gas (GHG) emissions. Following this encouraging development, JC3 will work with relevant authorities and partners to upscale the GVC among the government-linked companies (GLCs) and public listed companies. The JC3 intends to document the approaches and learnings gained during the pilot phase to serve as a reference as part of this effort.
The meeting also reviewed progress on the planned implementation of a new pilot programme focusing on Greening Industrial Parks (GIP). This initiative aims to support the financing of green infrastructure and transition of pilot park managers and tenant companies. Measurable outcomes include specific insights on financing structures and policy coordination to improve the viability of greening industrial parks that can be replicated to broader economic segments.
JC3 will continue to ensure meaningful support for SMEs to transition. This includes access to finance, capacity building and practical tools to help with the transition. The ESG Jumpstart Portal will serve as a one-stop information portal on climate transition for SMEs.
JC3 will collaborate with relevant Government agencies and service providers to help SMEs secure sector-specific green certifications at reduced costs. Standardised SME-focused due diligence templates and climate-related indicators are being developed to ease information requests made by financial institutions to SMEs, especially for loan and insurance applications.
Sustainability disclosure standards remain another important pillar for JC3. Datuk Kamarudin Hashim, Managing Director of the Securities Commission Malaysia and Co-Chair of JC3, said “With the release of the public consultation by the Advisory Committee on Sustainability Reporting (ACSR) on the proposed use of the International Sustainability Standards Board (ISSB) in Malaysia, the public is encouraged to share views on the approach, timing and other critical considerations and help shape the framework for Malaysia, as we look to ensure the reliability of the information disclosed.” The public can access and provide feedback on the issues as outlined in the Consultation Paper here.
The members discussed updates on ongoing efforts to address data gaps. They welcomed important progress made with the critical support of government agencies to improve the availability of key sectoral data relevant to priority use cases for the financial sector. Data sources will continue to be populated on the Climate Data Catalogue published by JC3.
Other strategic areas discussed include the integration of nature and environmental considerations into business operations, product offerings and financial institutions' decision-making processes. Programmes will be organised to build technical competency in this area. The industry's training needs will be supported by leveraging the Future Skills Framework that will be launched in 2Q 2024.
Bank Negara Malaysia
Securities Commission Malaysia
29 February 2024
About the JC3
The JC3 is a platform established in September 2019 to pursue collaborative actions for building climate resilience within the Malaysian financial sector. The JC3 is co-chaired by Datuk Jessica Chew Cheng Lian, Deputy Governor of Bank Negara Malaysia and Datuk Kamarudin Hashim, Managing Director of Securities Commission Malaysia, with members comprising senior officials from Bursa Malaysia and 21 financial industry players. The JC3’s initiatives and priorities are undertaken by its five sub-committees, namely Risk Management; Governance and Disclosure; Product and Innovation; Engagement and Capacity Building; and Bridging Data Gaps. An SME Focus Group has been established to develop strategies and solutions that support transition by SMEs.
Members: Allianz General Insurance Company (Malaysia) Berhad, AmBank (M) Berhad, Bank Islam Malaysia Berhad, Bank Pembangunan Malaysia Berhad, Bank Pertanian Malaysia Berhad (Agrobank), BIMB Investment Management Berhad, BNP Paribas Asset Management Sdn. Bhd., Bursa Malaysia Berhad, CIMB Bank, Etiqa Family Takaful Berhad, HSBC Amanah Malaysia Berhad, Kenanga Investors Berhad, Maybank Berhad, MIDF Amanah Investment Bank Berhad, MSIG Insurance (Malaysia) Berhad, RHB Islamic Bank Berhad, RHB Islamic International Asset Management Bhd., Standard Chartered Bank Malaysia Berhad, Swiss Re Asia Pte. Ltd. (Swiss Retakaful), Syarikat Takaful Malaysia Am Berhad, UOB Asset Management (Malaysia) Berhad and Zurich General Insurance Malaysia Berhad.
© Bank Negara Malaysia, 2024. All rights reserved.
| null | Press Release |
29 Feb 2024 | Detailed Disclosure of International Reserves as at end-January 2024 | https://www.bnm.gov.my/-/detailed-disclosure-of-international-reserves-as-at-end-january-2024-1 | null | null |
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Detailed Disclosure of International Reserves as at end-January 2024
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Detailed Disclosure of International Reserves as at end-January 2024
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1200 on
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29 Feb 2024
In accordance with the IMF SDDS format, the detailed breakdown of international reserves provides forward-looking information on the size, composition and usability of reserves and other foreign currency assets, and the expected and potential future inflows and outflows of foreign exchange of the Federal Government and Bank Negara Malaysia over the next 12-month period.
The detailed breakdown of international reserves based on the SDDS format is shown in Tables I, II, III and IV.
As shown in Table I, official reserve assets amounted to USD114,848.6 million, while other foreign currency assets amounted to USD2.3 million as at end-January 2024.
As shown in Table II, for the next 12 months, the pre-determined short-term outflows of foreign currency loans, securities and deposits, which include among others, scheduled repayment of external borrowings by the Government and the maturity of foreign currency Bank Negara Interbank Bills, amounted to USD15,517 million. The net short forward positions amounted to USD23,424.9 million as at end-January 2024, reflecting the management of ringgit liquidity in the money market. In line with the practice adopted since April 2006, the data excludes projected foreign currency inflows arising from interest income and the drawdown of project loans. Projected foreign currency inflows amount to USD2,608.2 million in the next 12 months.
As shown in Table III, the only contingent short-term net drain on foreign currency assets are Government guarantees of foreign currency debt due within one year, amounting to USD400.9 million. There are no foreign currency loans with embedded options, no undrawn, unconditional credit lines provided by or to other central banks, international organisations, banks and other financial institutions. Bank Negara Malaysia also does not engage in foreign currency options vis-à-vis ringgit.
Overall, the detailed breakdown of international reserves under the IMF SDDS format indicates that as at end-January 2024, Malaysia’s international reserves remain usable. Related Assets
International Reserves and Foreign Currency Liquidity (31 January 2024)
Bank Negara Malaysia
29 February 2024
© Bank Negara Malaysia, 2024. All rights reserved.
| null | Press Release |
27 Feb 2024 | Bank Negara Malaysia and the National Bank of Cambodia to strengthen regional cooperation in financial innovation and payments | https://www.bnm.gov.my/-/mou-nbc-en | null | null |
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Bank Negara Malaysia and the National Bank of Cambodia to strengthen regional cooperation in financial innovation and payments
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8
Bank Negara Malaysia and the National Bank of Cambodia to strengthen regional cooperation in financial innovation and payments
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27 Feb 2024
Bank Negara Malaysia (BNM) and the National Bank of Cambodia (NBC) signed a Memorandum of Understanding (MoU) to strengthen cooperation in financial innovation and payments.
The Prime Minister of Malaysia, Yang Amat Berhormat Datuk Seri Anwar Ibrahim and the Prime Minister of the Kingdom of Cambodia, Samdech Moha Borvor Thipadei Hun Manet witnessed the exchange of the MoU by BNM Governor Abdul Rasheed Ghaffour and NBC Governor Chea Serey.
The MoU will promote closer cooperation between BNM and NBC to drive financial innovation and foster more efficient and secure cross-border payments for the benefit of individuals and businesses in both countries. This includes the linking of domestic payment systems in both countries to enable cross-border QR payments. This cooperation also aims to encourage the use of local currency settlement and support the establishment of a cooperative oversight mechanism for safer cross-border payments.
This MoU marks another milestone in the ASEAN Regional Payment Connectivity initiative and is also aligned with the G20 Roadmap for enhancing the efficiency of cross-border payments. This in turn will facilitate cross-border trade and tourism activities between the countries. Up to 5 million merchants, including small businesses, from both countries that currently accept QR payments are set to benefit from this cooperation.
BNM Governor Abdul Rasheed Ghaffour said, “This MoU demonstrates both countries’ commitment to enhance cross-border payment and local currency settlement. This collaboration will deepen our long-standing cooperation with NBC for the mutual benefit of individuals and businesses in both countries. It also provides the impetus to spur greater innovation and deeper financial integration in support of regional economic development.”
NBC Governor Chea Serey said, "Today's event marks a significant step towards enhancing cooperation between our central banks. Through the MoU, the NBC and BNM will collaborate to drive financial innovation and improve cross-border QR code payment systems aiming to boost trade activities and financial inclusion in both countries and to promote the use of local currencies in line with ASEAN objectives."
Bank Negara Malaysia
National Bank of Cambodia
27 February 2024
© Bank Negara Malaysia, 2024. All rights reserved.
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27 Feb 2024 | BNM Governor’s quote on the ringgit development | https://www.bnm.gov.my/-/g-quote-rm | null | null |
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BNM Governor’s quote on the ringgit development
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27 Feb 2024
The ringgit is undervalued.
Given Malaysia’s positive economic fundamentals and prospects, the ringgit ought to be traded higher.
BNM has stepped up our engagements with GLICs, GLCs, corporations and investors to encourage continuous inflows to the foreign exchange market.
Abdul Rasheed Ghaffour
Governor of Bank Negara Malaysia
27 Feb 2024
© Bank Negara Malaysia, 2024. All rights reserved.
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22 Feb 2024 | International Reserves of Bank Negara Malaysia as at 15 February 2024 | https://www.bnm.gov.my/-/international-reserves-of-bank-negara-malaysia-as-at-15-february-2024 | https://www.bnm.gov.my/documents/20124/6118085/qb2021q4_en_box_imports.pdf | null |
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International Reserves of Bank Negara Malaysia as at 15 February 2024
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22 Feb 2024
The international reserves of Bank Negara Malaysia amounted to USD115.4 billion as at 15 February 2024. The reserves position is sufficient to finance 5.5 months of imports of goods and services[1], and is 1.0 time of the total short-term external debt.
[1] Under the previous import coverage measure, reserves is sufficient to finance 6.8 months of retained imports of goods. For more information on the new indicator, please refer to the article on “Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to Imports of Goods and Services” in BNM’s Quarterly Bulletin for the Fourth Quarter of 2021 publication, page 27, which can be accessed at bnm.gov.my/-/quarterly-bulletin-4q-2021 Related Assets
BNM Statement of Assets & Liabilities - 15 February 2024
Bank Negara Malaysia
22 February 2024
© Bank Negara Malaysia, 2024. All rights reserved.
|
Monthly Highlights
Headline inflation declined to 3.4% in March
March 2023
1
3.7 3.4
3.9 3.8
0.00
2.00
4.00
0.0
2.0
4.0
J
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Food & non-alcohol (29.5%) Housing & utilities (23.8%)
Transport (14.6%) Others (32.1%)
Headline inflation (RHS) Core inflation¹ (RHS)
Contribution to Inflation
ppt. contribution %, yoy
1 Core inflation is computed by excluding price-volatile and price-administered items.
Source: Department of Statistics, Malaysia & Bank Negara Malaysia estimates
• Headline inflation declined to 3.4% in March
(February: 3.7%) due mainly to lower inflation for
fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation moderated slightly to 3.8% during
the month (February: 3.9%), driven largely by
lower inflation for food away from home.
1
Robust growth in volume index driven by retail and motor vehicles
Index of Wholesale and Retail Trade
Source: Department of Statistics, Malaysia
• The Index of Wholesale and Retail Trade
(IOWRT) expanded by 10.6% in February 2023
(January: 8.5%).
• The higher growth was driven mainly by retail
sales in non-specialised stores (e.g., department
stores) followed by continued strength in
purchases of motor vehicles amid the ongoing
fulfilment of backlog orders.
• On a month-on-month seasonally adjusted basis,
the index accelerated by 5.5% (January: 0.2%).
9.5 8.510.6
0
10
20
30
40
Feb-
22
Mar-
22
Apr-
22
May-
22
Jun-
22
Jul-
22
Aug-
22
Sep-
22
Oct-
22
Nov-
22
Dec-
22
Jan-
23
Feb-
23
ppt, %yoy
Motor vehicles Retail Wholesale
2.4
5.2
4.4
0
1
2
3
4
5
6
7
Mar-22 Jul-22 Nov-22 Mar-23
Business loans
Household loans
Corporate bonds
Annual growth (%)
Growth in credit to the private non-financial sector moderated
1 Comprises loans to households and non-financial corporations from the
banking system and development financial institutions (DFIs), and corporate
bonds issued by non-financial corporations (including short-term papers).
2 Starting with the publication of December 2022 Monthly Highlights and
Statistics (MHS), this series was introduced to enhance the quality of
financing data. This new data series is available in the MHS Table 2.18.
Source: Bank Negara Malaysia
2.7 2.6 2.7 2.6
1.0 0.6 0.7 0.7
1.0
1.1 1.1 0.9
4.7 4.3 4.5 4.2
Dec-22 Jan-23 Feb-23 Mar-23
Corporate Bonds
Business Loans
Household Loans
Credit to the Private Non-
Financial Sector
Contribution to growth (ppt)
• Credit to the private non-financial sector grew by
4.2% as at end-March (February: 4.5%), attributed
to slower growth in credit to businesses (3.2%;
February: 3.7%).
• While growth in outstanding corporate bonds
moderated (4.4%; February : 5.5%), outstanding
business loan growth was sustained at 2.4%
(February: 2.4%). This was supported by the
continued growth in both working capital (2.2%;
February: 1.9%) and investment-related loans
(4.3%; February: 4.2%).
• Outstanding household loan growth remained
broadly stable (5.2%; February: 5.3%), supported
by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan
growth for the purchase of securities (-6.9%;
February: -3.3%).
Credit to the Private Non-Financial Sector1,2
Monthly Highlights
March 2023
Domestic financial market conditions remained orderly
Financial Market Performance in March 2023
Source: Bank Negara Malaysia, Bursa Malaysia
Note: The exchange rate data is the noon-rate in the Kuala Lumpur Interbank Foreign Exchange Market
11.0
-2.1
-5.3
0.0
-2.2
1.7
10-year MGS
(bps, mom)
Equity
(%, mom)
Ringgit
(%, mom)
-10 -5 0 5 10 15
Mar-23
Feb-23
• In March, global financial markets were affected by
the emergence of banking sector stress in some
major economies. As spillovers were contained thus
far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds
improved.
• In line with the performance of regional currencies,
the ringgit appreciated by 1.7% against the US
dollar. Conditions in the domestic bond market
also remained stable.
• The FBM KLCI declined by 2.2% during the month.
2
Banks maintained strong liquidity and funding positions to support intermediation
Source: Bank Negara Malaysia
Banking System Liquidity and Funding Ratios
81.9
157.4
0
40
80
120
160
70
75
80
85
90
95
M
a
r
2
2
A
p
r
2
2
M
a
y
2
2
J
u
n
2
2
J
u
l
2
2
A
u
g
2
2
S
e
p
2
2
O
c
t
2
2
N
o
v
2
2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
% %
Liquidity Coverage Ratio (RHS)
Loan-to-Fund Ratio
Asset quality in the banking system remained intact
Banking System Asset Quality
Source: Bank Negara Malaysia
• Overall gross and net impaired loans ratios
increased slightly to 1.8% (February-23: 1.8%) and
1.2% (February-23: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory
reserves) continue to record a prudent level of
110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
%
1.8
1.2
1.7
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
M
a
r
2
2
A
p
r
2
2
M
a
y
2
2
J
u
n
2
2
J
u
l
2
2
A
u
g
2
2
S
e
p
2
2
O
c
t
2
2
N
o
v
2
2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
Gross Impaired Loans Ratio
Total Provisions to Total Loans Ratio
Net Impaired Loans Ratio
• Banks continued to record healthy liquidity buffers
with the aggregate Liquidity Coverage Ratio at
157.4% (February-23: 152.7%).
• The aggregate loan-to-fund ratio remained stable at
81.9% (February-23: 81.6%).
PRESS RELEASE
Ref. No.: 04/23/05 EMBARGO: Not for publication or
broadcast before 1500 hours on
Friday, 28 April 2023
Monthly Highlights – March 2023
Headline inflation declined to 3.4% in March
• Headline inflation declined to 3.4% in March (February: 3.7%) due mainly
to lower inflation for fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation1 moderated slightly to 3.8% during the month
(February: 3.9%), driven largely by lower inflation for food away from
home.
Robust growth in volume index driven by retail and motor vehicles
• The Index of Wholesale and Retail Trade (IOWRT) expanded by 10.6%
in February 2023 (January: 8.5%).
• The higher growth was driven mainly by retail sales in non-specialised
stores (e.g., department stores) followed by continued strength in
purchases of motor vehicles amid the ongoing fulfilment of backlog
orders.
• On a month-on-month seasonally adjusted basis, the index accelerated
by 5.5% (January: 0.2%).
1 Core inflation is computed by excluding price-volatile and price-administered items.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Growth in credit to the private non-financial sector2,3 moderated
• Credit to the private non-financial sector grew by 4.2% as at end-March
(February: 4.5%), attributed to slower growth in credit to businesses
(3.2%; February: 3.7%).
• While growth in outstanding corporate bonds moderated (4.4%;
February: 5.5%), outstanding business loan growth was sustained at
2.4% (February: 2.4%). This was supported by the continued growth in
both working capital (2.2%; February: 1.9%) and investment-related
loans (4.3%; February: 4.2%).
• Outstanding household loan growth remained broadly stable (5.2%;
February: 5.3%), supported by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan growth for the purchase of
securities (-6.9%; February: -3.3%).
Domestic financial market conditions remained orderly
• In March, global financial markets were affected by the emergence of
banking sector stress in some major economies. As spillovers were
contained thus far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds improved.
• In line with the performance of regional currencies, the ringgit
appreciated by 1.7% against the US dollar. Conditions in the domestic
bond market also remained stable.
• The FBM KLCI declined by 2.2% during the month.
Banks maintained strong liquidity and funding positions to support
intermediation
• Banks continued to record healthy liquidity buffers with the aggregate
Liquidity Coverage Ratio at 157.4% (February: 152.7%).
2 Comprises loans to households and non-financial corporations from the banking system and development financial
institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers).
3 Starting with the publication of December 2022 Monthly Highlights and Statistics (MHS), this series was introduced
to enhance the quality of financing data. This new data series is available in the MHS Table 2.18.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
• The aggregate loan-to-fund ratio remained stable at 81.9%
(February: 81.6%).
Asset quality in the banking system remained intact
• Overall gross and net impaired loans ratios increased slightly to 1.8%
(February: 1.8%) and 1.2% (February: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory reserves) continues to
record a prudent level of 110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
Bank Negara Malaysia
28 April 2023
20230428_BNM Monthly Highlights-March_en
Slide 1
Slide 2
20230428_BNM PR_Monthly Highlights-Mar 2023_eng
| Press Release |
20 Feb 2024 | BNM Governor's Quote on the ringgit development | https://www.bnm.gov.my/-/g-quote-ringgit | null | null |
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BNM Governor's Quote on the ringgit development
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BNM Governor's Quote on the ringgit development
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20 Feb 2024
The recent performance of the ringgit, similar to other regional currencies, has been influenced by external factors. Some of these factors include market adjustment to changing US interest rate expectations, geopolitical concerns and uncertainty surrounding China’s economic prospects.
BNM is of the view that the current level of the ringgit does not reflect the positive prospects of the Malaysian economy going forward.
Growth in 2024 will be driven by the improvement in external demand and strong domestic spending. The latest IMF forecast is for global trade to improve from 0.4% in 2023 to 3.3% in 2024. For Malaysia, exports have shown steady improvements since the fourth quarter of 2023. In fact, the recently-released January 2024 exports have turned positive (+8.7%). The tourism sector has recovered strongly with tourist arrivals in 2024 expected to exceed the pre-pandemic levels of 26 million. Investment momentum has picked up with the implementation of approved projects both in the private and public sectors.
Reflecting these positive developments, the Government’s commitment to implement structural reforms and the expected lowering of interest rates in advanced economies, most analysts are forecasting for the ringgit to appreciate this year.
Abdul Rasheed Ghaffour
Governor of Bank Negara Malaysia
20 Feb 2024
© Bank Negara Malaysia, 2024. All rights reserved.
| null | Press Release |
16 Feb 2024 | Economic and Financial Developments in Malaysia in the Fourth Quarter of 2023 | https://www.bnm.gov.my/-/qb23q4_en_pr | https://www.bnm.gov.my/documents/20124/13494133/qb23q4_en_table1.pdf | null |
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Economic and Financial Developments in Malaysia in the Fourth Quarter of 2023
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38
Economic and Financial Developments in Malaysia in the Fourth Quarter of 2023
Embargo :
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1200 on
Friday, 16 February 2024
16 Feb 2024
The economy grew by 3% in the fourth quarter
The Malaysian economy expanded by 3% in the fourth quarter of 2023 (3Q 2023: 3.3%; 2Q 2023: 2.9%). Household spending remained supported by improving labour market conditions and easing cost pressures. The unemployment rate declined to the pre-pandemic level of 3.3% while the labour force participation rate was at a historic high in 2023. Meanwhile, growth in investment activity was underpinned by the progressive realisation of multi-year projects and capacity expansion by firms. Exports, however, remained subdued due to prolonged weakness in external demand amid stronger imports. On the supply side, there was a broad-based expansion. The commodities sector grew. This was supported by higher oil and gas production as well as expansion in the agriculture sector amid improved labour supply. The services and construction sectors continued to expand. The manufacturing sector remained soft from continued weakness in the electrical and electronics industry. In terms of monthly GDP, December recorded a growth of 1.4%, lower than November (3.8%) and October (3.9%), attributed mainly to the shorter school holiday period during the month and weaker export-oriented manufacturing sector. On a quarter-on-quarter seasonally-adjusted basis, the economy contracted by 2.1% (3Q 2023: +2.6%).
Overall, the 2023 growth for the Malaysian economy normalised to 3.7%, following a strong growth registered in the previous year (2022: 8.7%). Growth moderated amid a challenging external environment. This was due mainly to slower global trade, the global tech downcycle, geopolitical tensions and tighter monetary policies. On the domestic front, despite the lapse of large policy support provided as the economy started to open up in 2022, the continued recovery in economic activity and labour market conditions supported growth in 2023. In addition, the solid growth performance of the economy is reinforced by a resilient external position. Despite the challenging external environment, the current account surplus for the year 2023 was sustained at 1.2% of GDP, supported by a diversified export structure across market and product. The strength in external position is also reflected in the external debt, which declined to 68.2% of GDP in 2023 (3Q 2023: 69%), and a higher net international investment position at 6.6% of GDP in 2023 (3Q 2023: 5.2%). Importantly, the external debt remains manageable given the favourable maturity and currency profiles. One-third of the external debt is denominated in ringgit, limiting currency risk, while around 70% of debt have medium and longer-term tenures. Foreign currency borrowings are also subject to Bank Negara Malaysia (BNM)’s prudential requirements and continue to consist mainly of concessionary intragroup loans.
Headline inflation continued to decline to 1.6% during the quarter (3Q 2023: 2%). The downward trend was contributed by the moderation in fresh food inflation (4Q 2023: 0.5%; 3Q 2023: 1.9%) and core inflation (2%; 3Q 2023: 2.5%). The lower core inflation was largely driven by an easing in services sub-segments, including food away from home and repair and maintenance of personal transport. Inflation pervasiveness continued to trend lower, as the share of Consumer Price Index items recording monthly price increases moderated to 36.3% during the quarter (3Q 2023: 40.8%). This brought inflation pervasiveness below its fourth quarter long-term average (2011-2019) of 41.7%. For 2023 as a whole, headline inflation declined to 2.5% (2022: 3.3%) while core inflation averaged at 3% (2022: 3%).
Exchange rate developments
Domestic financial markets continued to be driven by evolving financial market expectations over the global monetary policy path. In particular, financial market participants viewed that the US policy rate had already peaked and that the US Federal Reserve will start reducing the policy rate in 2024 amid the ongoing disinflation.
Against this backdrop, the ringgit appreciated by 2.1% against the US dollar in the fourth quarter of 2023, in line with regional currencies following a broad-based depreciation in the US dollar. Malaysia’s external position also remains supportive of inflows. BNM will continue to ensure sufficient liquidity to support the orderly functioning of the domestic foreign exchange market.
Financing conditions
Credit to the private non-financial sector expanded by 4.7% (3Q 2023: 4.3%), driven by higher growth in business loans (3.6%; 3Q 2023: 1.9%) while outstanding corporate bonds growth moderated to 4.2% (3Q 2023: 5%). The higher business loan growth was driven mainly by higher growth in working capital loans. Of note, SME loan growth remained forthcoming (8.2%; 3Q 2023: 7%). For households, outstanding loan growth remained steady at 5.6% (3Q 2023: 5.4%), reflecting sustained growth across key purposes.
Moving forward, Malaysia’s growth to improve due to resilient domestic expenditure and recovery in external demand
Growth in 2024 will be driven by resilient domestic expenditure and improvement in external demand. On the external front, the IMF is projecting a rebound in global trade growth from 0.4% in 2023 to 3.3% in 2024. Together with the tech upcycle, the stronger external demand and continued improvement in the tourism sector will provide support to Malaysia’s exports. On the domestic front, household spending will be supported by continued employment and wage growth. Investment activity will be underpinned by further progress of multi-year projects, by both the private and public sectors, as well as the implementation of catalytic initiatives under the various national master plans. Improvement in tourist arrivals and spending are expected to continue. The growth outlook remains subject to downside risks stemming from weaker-than-expected external demand and larger declines in commodity production. Nonetheless, there are upside risks to growth emanating from greater spillover from the tech upcycle, stronger-than-expected tourism activity and faster implementation of existing and new projects.
Headline and core inflation to remain modest in 2024
Both headline and core inflation have moderated due mainly to lower cost pressures amid stabilising demand conditions. In 2024, inflation is expected to remain modest, broadly reflecting stable cost and demand conditions. However, inflation outlook remains highly subject to changes to domestic policy on subsidies and price controls, as well as global commodity prices and financial market developments.
BNM will publish its Annual Report 2023, the Economic and Monetary Review 2023, and the Financial Stability Review for the Second Half of 2023 on 20 March 2024.
See also:
Publication: Quarterly Bulletin Fourth Quarter 2023
Table 1: GDP by Expenditure Components and Economic ActivityBank Negara Malaysia
16 February 2024
© Bank Negara Malaysia, 2024. All rights reserved.
|
Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to Imports of Goods and Services
27Quarterly Bulletin | 4Q 2021
Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to
Imports of Goods and Services
One of the indicators used by the Bank to measure international reserve adequacy is the reserve coverage
of retained imports,1 which is communicated on a fortnightly basis. As the economy grew and evolved with
higher share of the services sector, this has raised the prominence of services imports in the measure of
reserve adequacy. Given this consideration and in line with the international best practice, future fortnightly
reporting of Malaysia’s international reserves will include the indicator on reserve coverage of imports of
goods and services, effective from 22 February 2022.2
1 Defined as gross imports subtracted with re-exports. The 12-month average retained imports can be derived from the Monthly Highlight and Statistics Table
3.6.8 (Imports by End-Use; see Appendix 1).
2 For the international reserves position as at 15 February 2022.
3 Defined as imports plus exports.
4 From RM101.3 billion to RM351.3 billion, or a compound annual growth rate (CAGR) of 6.4%.
5 Based on JP Morgan’s Government Bond Index for Emerging Markets.
Services tradeC1
0
100
200
300
400
1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021
RM billion
Travel1
Computer and information
Transport
Manufacturing
Other business3
Other2
Perdagangan perkhidmatanR1
0
100
200
300
400
1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021
RM bilion
Perjalanan1
Komputer dan informasi
Pengangkutan
Pembuatan
Perniagaan Lain3
Lain-lain2
Nota: Data sebelum tahun 2005 adalah berdasarkan garis panduan dalam Edisi Kelima Manual Imbangan Pembayaran dan Kedudukan
............Pelaburan Antarabangsa (BPM5) IMF. Data bagi tahun 2005 dan selanjutnya adalah berdasarkan BPM6.
1 Termasuk perbelanjaan perjalanan bagi aktiviti pelancongan.
2 Termasuk pembinaan, caj penggunaan harta intelek, perkhidmatan persendirian, kebudayaan dan rekreasi.
3 Perkhidmatan perniagaan lain termasuk perkhidmatan penyelidikan dan pembangunan, profesional, teknikal, berkaitan perdagangan dan
...perkhidmatan perniagaan lain.
Sumber: Jabatan Perangkaan Malaysia dan Bank Negara Malaysia
Note: Data prior to 2005 are based on the guideline in the Fifth Edition of the Balance of Payments and International Investment Position
............Manual (BPM5) of the IMF. Data for 2005 and beyond are based on BPM6.
1 Includes travel spending for tourism activity.
2 Includes construction, charges for intellectual property use, personal, culture & recreational services.
3 Other business services comprise research and development, professional, technical, trade-related and other business services.
Source: Department of Statistics, Malaysia and Bank Negara Malaysia
The Bank’s reporting of the reserve coverage of retained imports was published as early as in the 1990s. Data
on retained imports are available on monthly basis and thereby closely match the fortnightly release of the
international reserves data. However, retained imports do not include payment for services, which has grown
over the past two decades. From 1999 to 2019, services trade3 has increased by 246.9%4 (Chart 1). This was
mainly due to higher tourism activity as well as payments for foreign transport services for goods trade. In
addition, there was also an expansion in goods import, largely in support of domestic investment activities
and production of manufactured goods.
Malaysia’s performance on this indicator is in line with regional and peer5 economies. On historical basis,
reserve coverage of imports of goods and services indicator has been in the range of between 5 and 8
months since 2008 – well above the generally-accepted ‘rule of thumb’ adequacy threshold of 3-months, and
demonstrates the ability of the Malaysian economy to withstand against external shocks.
28 Quarterly Bulletin | 4Q 2021
It is also important to emphasize that the assessment of reserve adequacy should not be solely based
on the face value of these indicators. This needs to be complemented with deeper understanding about
the country’s external position, financial system and broad economic policies. In particular, international
reserves is not the only means to meet external obligations.6 Prevailing assessment indicates that the
country’s external position7 is underpinned by its strong economic fundamentals including healthy current
account surplus, large foreign currency external assets held by domestic entities8 and the flexible ringgit
exchange rate.
References
Department of Statistics, Malaysia. ‘External Sector’, Jabatan Perangkaan Malaysia, Putrajaya.
Greenspan, A., ‘Currency reserves and debt’. Remarks before the World Bank Conference on Recent Trends in
Reserves Management, Washington, DC, 29 April 1999.
International Monetary Fund, (2016). ‘Guidance Note on the Assessment of Reserve Adequacy and Related
Considerations’.
Appendix 1: Calculation of international reserves coverage of retained imports
aFor example, to calculate monthly retained imports for December 2019, the retained imports for the months of
January to December 2019 is summed up (i.e. rolling 12-months of retained imports). This number is then divided
by 12, to obtain a monthly average. The figures can be obtained from BNM’s MHS Table 3.6.8, column S.
6 Further information can be found in the box article “Malaysia’s Resilience in Managing External Debt Obligations and the Adequacy of International Reserves”
in BNM’s Annual Report 2018.
7 In addition, it has also been emphasized that Malaysia’s external debt position, including short-term external debt, remains manageable. This is supported by
the favourable currency and maturity profile on its external debt as well as domestic entities’ resilient repayment capacity. Foreign-currency external debt of
corporates are also mainly subject to prudential and hedging requirements (refer to the latest assessment on external debt developments on page 25)
8 Amounting to RM1.1 trillion as at end-2021.
| Press Release |
08 Feb 2024 | International Reserves of Bank Negara Malaysia as at 31 January 2024 | https://www.bnm.gov.my/-/international-reserves-of-bank-negara-malaysia-as-at-31-january-2024 | https://www.bnm.gov.my/documents/20124/6118085/qb2021q4_en_box_imports.pdf | null |
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International Reserves of Bank Negara Malaysia as at 31 January 2024
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International Reserves of Bank Negara Malaysia as at 31 January 2024
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8 Feb 2024
The international reserves of Bank Negara Malaysia amounted to USD114.8 billion as at 31 January 2024. The reserves level has taken into account the quarterly foreign exchange revaluation changes. The reserves position is sufficient to finance 5.4 months of imports of goods and services[1], and is 1.0 times of the total short-term external debt.
[1] Under the previous import coverage measure, reserves is sufficient to finance 6.9 months of retained imports of goods. For more information on the new indicator, please refer to the article on “Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to Imports of Goods and Services” in BNM’s Quarterly Bulletin for the Fourth Quarter of 2021 publication, page 27, which can be accessed at Quarterly Bulletin 4Q2021. Related Assets
BNM Statement of Assets & Liabilities - 31 January 2024
Bank Negara Malaysia
8 February 2024
© Bank Negara Malaysia, 2024. All rights reserved.
|
Monthly Highlights
Headline inflation declined to 3.4% in March
March 2023
1
3.7 3.4
3.9 3.8
0.00
2.00
4.00
0.0
2.0
4.0
J
a
n
-2
2
F
e
b
-2
2
M
a
r-
2
2
A
p
r-
2
2
M
a
y
-2
2
J
u
n
-2
2
J
u
l-
2
2
A
u
g
-2
2
S
e
p
-2
2
O
c
t-
2
2
N
o
v
-2
2
D
e
c
-2
2
J
a
n
-2
3
F
e
b
-2
3
M
a
r-
2
3
Food & non-alcohol (29.5%) Housing & utilities (23.8%)
Transport (14.6%) Others (32.1%)
Headline inflation (RHS) Core inflation¹ (RHS)
Contribution to Inflation
ppt. contribution %, yoy
1 Core inflation is computed by excluding price-volatile and price-administered items.
Source: Department of Statistics, Malaysia & Bank Negara Malaysia estimates
• Headline inflation declined to 3.4% in March
(February: 3.7%) due mainly to lower inflation for
fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation moderated slightly to 3.8% during
the month (February: 3.9%), driven largely by
lower inflation for food away from home.
1
Robust growth in volume index driven by retail and motor vehicles
Index of Wholesale and Retail Trade
Source: Department of Statistics, Malaysia
• The Index of Wholesale and Retail Trade
(IOWRT) expanded by 10.6% in February 2023
(January: 8.5%).
• The higher growth was driven mainly by retail
sales in non-specialised stores (e.g., department
stores) followed by continued strength in
purchases of motor vehicles amid the ongoing
fulfilment of backlog orders.
• On a month-on-month seasonally adjusted basis,
the index accelerated by 5.5% (January: 0.2%).
9.5 8.510.6
0
10
20
30
40
Feb-
22
Mar-
22
Apr-
22
May-
22
Jun-
22
Jul-
22
Aug-
22
Sep-
22
Oct-
22
Nov-
22
Dec-
22
Jan-
23
Feb-
23
ppt, %yoy
Motor vehicles Retail Wholesale
2.4
5.2
4.4
0
1
2
3
4
5
6
7
Mar-22 Jul-22 Nov-22 Mar-23
Business loans
Household loans
Corporate bonds
Annual growth (%)
Growth in credit to the private non-financial sector moderated
1 Comprises loans to households and non-financial corporations from the
banking system and development financial institutions (DFIs), and corporate
bonds issued by non-financial corporations (including short-term papers).
2 Starting with the publication of December 2022 Monthly Highlights and
Statistics (MHS), this series was introduced to enhance the quality of
financing data. This new data series is available in the MHS Table 2.18.
Source: Bank Negara Malaysia
2.7 2.6 2.7 2.6
1.0 0.6 0.7 0.7
1.0
1.1 1.1 0.9
4.7 4.3 4.5 4.2
Dec-22 Jan-23 Feb-23 Mar-23
Corporate Bonds
Business Loans
Household Loans
Credit to the Private Non-
Financial Sector
Contribution to growth (ppt)
• Credit to the private non-financial sector grew by
4.2% as at end-March (February: 4.5%), attributed
to slower growth in credit to businesses (3.2%;
February: 3.7%).
• While growth in outstanding corporate bonds
moderated (4.4%; February : 5.5%), outstanding
business loan growth was sustained at 2.4%
(February: 2.4%). This was supported by the
continued growth in both working capital (2.2%;
February: 1.9%) and investment-related loans
(4.3%; February: 4.2%).
• Outstanding household loan growth remained
broadly stable (5.2%; February: 5.3%), supported
by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan
growth for the purchase of securities (-6.9%;
February: -3.3%).
Credit to the Private Non-Financial Sector1,2
Monthly Highlights
March 2023
Domestic financial market conditions remained orderly
Financial Market Performance in March 2023
Source: Bank Negara Malaysia, Bursa Malaysia
Note: The exchange rate data is the noon-rate in the Kuala Lumpur Interbank Foreign Exchange Market
11.0
-2.1
-5.3
0.0
-2.2
1.7
10-year MGS
(bps, mom)
Equity
(%, mom)
Ringgit
(%, mom)
-10 -5 0 5 10 15
Mar-23
Feb-23
• In March, global financial markets were affected by
the emergence of banking sector stress in some
major economies. As spillovers were contained thus
far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds
improved.
• In line with the performance of regional currencies,
the ringgit appreciated by 1.7% against the US
dollar. Conditions in the domestic bond market
also remained stable.
• The FBM KLCI declined by 2.2% during the month.
2
Banks maintained strong liquidity and funding positions to support intermediation
Source: Bank Negara Malaysia
Banking System Liquidity and Funding Ratios
81.9
157.4
0
40
80
120
160
70
75
80
85
90
95
M
a
r
2
2
A
p
r
2
2
M
a
y
2
2
J
u
n
2
2
J
u
l
2
2
A
u
g
2
2
S
e
p
2
2
O
c
t
2
2
N
o
v
2
2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
% %
Liquidity Coverage Ratio (RHS)
Loan-to-Fund Ratio
Asset quality in the banking system remained intact
Banking System Asset Quality
Source: Bank Negara Malaysia
• Overall gross and net impaired loans ratios
increased slightly to 1.8% (February-23: 1.8%) and
1.2% (February-23: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory
reserves) continue to record a prudent level of
110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
%
1.8
1.2
1.7
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
M
a
r
2
2
A
p
r
2
2
M
a
y
2
2
J
u
n
2
2
J
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2
2
A
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2
2
S
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2
2
O
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t
2
2
N
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2
2
D
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2
2
J
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2
3
F
e
b
2
3
M
a
r
2
3
Gross Impaired Loans Ratio
Total Provisions to Total Loans Ratio
Net Impaired Loans Ratio
• Banks continued to record healthy liquidity buffers
with the aggregate Liquidity Coverage Ratio at
157.4% (February-23: 152.7%).
• The aggregate loan-to-fund ratio remained stable at
81.9% (February-23: 81.6%).
PRESS RELEASE
Ref. No.: 04/23/05 EMBARGO: Not for publication or
broadcast before 1500 hours on
Friday, 28 April 2023
Monthly Highlights – March 2023
Headline inflation declined to 3.4% in March
• Headline inflation declined to 3.4% in March (February: 3.7%) due mainly
to lower inflation for fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation1 moderated slightly to 3.8% during the month
(February: 3.9%), driven largely by lower inflation for food away from
home.
Robust growth in volume index driven by retail and motor vehicles
• The Index of Wholesale and Retail Trade (IOWRT) expanded by 10.6%
in February 2023 (January: 8.5%).
• The higher growth was driven mainly by retail sales in non-specialised
stores (e.g., department stores) followed by continued strength in
purchases of motor vehicles amid the ongoing fulfilment of backlog
orders.
• On a month-on-month seasonally adjusted basis, the index accelerated
by 5.5% (January: 0.2%).
1 Core inflation is computed by excluding price-volatile and price-administered items.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Growth in credit to the private non-financial sector2,3 moderated
• Credit to the private non-financial sector grew by 4.2% as at end-March
(February: 4.5%), attributed to slower growth in credit to businesses
(3.2%; February: 3.7%).
• While growth in outstanding corporate bonds moderated (4.4%;
February: 5.5%), outstanding business loan growth was sustained at
2.4% (February: 2.4%). This was supported by the continued growth in
both working capital (2.2%; February: 1.9%) and investment-related
loans (4.3%; February: 4.2%).
• Outstanding household loan growth remained broadly stable (5.2%;
February: 5.3%), supported by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan growth for the purchase of
securities (-6.9%; February: -3.3%).
Domestic financial market conditions remained orderly
• In March, global financial markets were affected by the emergence of
banking sector stress in some major economies. As spillovers were
contained thus far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds improved.
• In line with the performance of regional currencies, the ringgit
appreciated by 1.7% against the US dollar. Conditions in the domestic
bond market also remained stable.
• The FBM KLCI declined by 2.2% during the month.
Banks maintained strong liquidity and funding positions to support
intermediation
• Banks continued to record healthy liquidity buffers with the aggregate
Liquidity Coverage Ratio at 157.4% (February: 152.7%).
2 Comprises loans to households and non-financial corporations from the banking system and development financial
institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers).
3 Starting with the publication of December 2022 Monthly Highlights and Statistics (MHS), this series was introduced
to enhance the quality of financing data. This new data series is available in the MHS Table 2.18.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
• The aggregate loan-to-fund ratio remained stable at 81.9%
(February: 81.6%).
Asset quality in the banking system remained intact
• Overall gross and net impaired loans ratios increased slightly to 1.8%
(February: 1.8%) and 1.2% (February: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory reserves) continues to
record a prudent level of 110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
Bank Negara Malaysia
28 April 2023
20230428_BNM Monthly Highlights-March_en
Slide 1
Slide 2
20230428_BNM PR_Monthly Highlights-Mar 2023_eng
| Press Release |
06 Feb 2024 | Inaccurate Ringgit Exchange Rate Data Published | https://www.bnm.gov.my/-/inaccurate-usdmyr | null | null |
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Inaccurate Ringgit Exchange Rate Data Published
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20
Inaccurate Ringgit Exchange Rate Data Published
Embargo :
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1542 on
Tuesday, 6 February 2024
6 Feb 2024
Bank Negara Malaysia (BNM) wishes to address the inaccurate ringgit exchange rate data, including the USD/MYR rate, published by Google on 5 February 2024.
For USD/MYR, the exchange rate was misreported on Google as 6.24. However, the high and low trading range for USD/MYR recorded in the onshore interbank market for ringgit was between 4.7480 and 4.7630 on 5 February, as published on the BNM website.
Members of the public are advised to exercise caution against using unverifiable sources as a reference for the ringgit.
Bank Negara Malaysia
6 February 2024
© Bank Negara Malaysia, 2024. All rights reserved.
| null | Press Release |
31 Jan 2024 | Monetary and Financial Developments in December 2023 | https://www.bnm.gov.my/-/monetary-and-financial-developments-in-december-2023 | https://www.bnm.gov.my/documents/20124/13352988//i_en.pdf | null |
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Monetary and Financial Developments in December 2023
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Monetary and Financial Developments in December 2023
Embargo :
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1500 on
Wednesday, 31 January 2024
31 Jan 2024
Headline inflation remained unchanged at 1.5% in December
Headline inflation remained unchanged at 1.5% in December (November 2023: 1.5%), while core inflation edged lower to 1.9% (November 2023: 2.0%).
In particular, the moderation in core inflation[1] was due to lower inflation for food away from home at 3.4% (November 2023: 3.9%).
Slightly higher wholesale and retail trade growth in November
The Index of Wholesale and Retail Trade (IOWRT) increased by 4.7% in November 2023 (October 2023: 4.5%).
The expansion was driven by wholesale trade in other specialised wholesale components followed by retail trade in other household equipment in specialised stores.
However, sales of motor vehicles moderated during the month.
Sustained growth in credit to the private non-financial sector
Credit to the private non-financial sector[2],[3] grew by 4.7% as at end-December (November 2023: 4.6%), driven mainly by higher growth in credit to businesses (3.8%; November 2023: 3.5%).
Outstanding business loan growth increased to 3.6% (November 2023: 2.7%), driven mainly by higher growth in working capital loans. Of note, SME loan growth continued to improve (8.2%; November 2023: 7.9%). Outstanding corporate bonds growth, however, moderated slightly to 4.2% (November 2023: 4.6%).
For households, outstanding loan growth was sustained at 5.6% (November 2023: 5.7%), supported by broadly stable growth across most loan purposes. This was reflective of the continued demand for loans, with the growth in loan applications higher at 26.0% (November 2023: 13.5%).
Domestic financial markets were primarily influenced by global investors’ expectations for US policy rate reductions in 2024
Global financial conditions were driven by financial market expectations that the US Federal Reserve would begin lowering their policy interest rate as early as 2024 due to continued disinflation. Reflecting these investor sentiments, global bond yields declined while global equity markets traded higher.
Against this backdrop, the ringgit appreciated by 1.3% against the US dollar (regional [4] average: +0.6%), while the 10-year MGS yield decreased by 7 bps (regional [4] average: -29 bps).
Meanwhile, the FBM KLCI traded slightly higher by 0.1%, in line with other bourses (regional [4] average: 3.2%).
Banks maintained strong liquidity and funding positions to support intermediation
The banking system overall Liquidity Coverage Ratio rose in December as banks proactively managed buffers to address anticipated year end seasonal fluctuations in their deposit levels.
The aggregate loan-to-fund ratio remained broadly stable at 81.8% (November 2023: 82.5%).
Asset quality in the banking system remained intact
Overall gross and net impaired loans ratios remained broadly stable at 1.6% (November 2023: 1.7%) and 1.1% (November 2023: 1.0%), respectively.
Loan loss coverage ratio (including regulatory reserves) continues to be at a prudent level of 119.2% of impaired loans, with total provisions accounting for 1.5% of total loans.
[1] Core inflation is computed by excluding price-volatile and price-administered items.
[2] Comprises loans to households and non-financial corporations from the banking system, development financial institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers).
[3] Starting with the publication of December 2022 Monthly Highlights and Statistics (MHS), this series was introduced to enhance the quality of financing data. This new data series is available in the MHS Table 2.18.
[4] Regional countries comprise: Singapore, Thailand, Philippines, Indonesia, and Korea.
Monthly Highlights [PDF]
Related Assets
Monthly Highlights & Statistics in December 2023
Bank Negara Malaysia
31 January 2024
© Bank Negara Malaysia, 2024. All rights reserved.
|
Monthly Highlights May 2023
Monthly Highlights
Headline inflation declined further to 2.8% in May
May 2023
Contribution to Inflation
ppt. contribution %, yoy
1 Core inflation is computed by excluding price-volatile and price-administered items.
Source: Department of Statistics, Malaysia & Bank Negara Malaysia estimates
• Headline inflation moderated to 2.8% (April 2023:
3.3%). This decline was largely due to non-core
CPI components, particularly lower inflation for
fuel (-0.2 percentage points, ppt) and fresh food
(-0.1ppt).
• Core inflation also declined slightly to 3.5% (April
2023: 3.6%) amid lower inflation for
communication services.
3.3
2.8
3.6 3.5
0.00
2.00
4.00
0.0
2.0
4.0
J
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-2
2
F
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-2
2
M
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2
2
A
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2
2
M
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-2
2
J
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-2
2
J
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2
2
A
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-2
2
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2
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2
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-2
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-2
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-2
3
F
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3
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3
A
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3
M
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-2
3
Food & non-alcohol (29.5%) Housing & utilities (23.8%)
Transport (14.6%) Others (32.1%)
Headline inflation (RHS) Core inflation¹ (RHS)
1.6
5.1
4.6
0
1
2
3
4
5
6
7
May-22 Sep-22 Jan-23 May-23
Business loans
Household loans
Corporate bonds
Annual growth (%)
Credit to the Private Non-Financial Sector1,2
1
Growth in credit to the private non-financial sector improved in May
1 Comprises loans to households and non-financial corporations from the
banking system and development financial institutions (DFIs), and corporate
bonds issued by non-financial corporations (including short-term papers).
2 Starting with the publication of December 2022 Monthly Highlights and
Statistics (MHS), this series was introduced to enhance the quality of
financing data. This new data series is available in the MHS Table 2.18.
Source: Bank Negara Malaysia
Contribution to growth (ppt)
• Credit to the private non-financial sector expanded
by 4.0% as at end-May (April 2023: 3.7%), driven
mainly by higher growth in credit to businesses
(2.8%; April 2023: 2.5%).
• Outstanding corporate bonds grew by 4.6% (April
2023: 4.4%), while outstanding business loans
expanded by 1.6% (April 2023: 1.0%). The higher
business loan growth reflected improvement in
loans for both working capital and investments to
SMEs and non-SMEs.
• In the household segment, outstanding loan
growth was sustained at 5.1% (April 2023: 5.0%),
supported by higher growth across most loan
purposes. Of note, household loan growth
continued to be driven by loans for the purchase of
houses and cars, which grew by 7.0% and 8.4%,
respectively (April 2023: 6.8% and 8.0%).
2.7 2.6 2.5 2.6
0.7 0.7 0.3 0.5
1.1 0.9
0.9 1.0
4.5 4.2
3.7 4.0
Feb-23 Mar-23 Apr-23 May-23
Corporate Bonds
Business Loans
Household Loans
Credit to the Private Non-
Financial Sector
Index of wholesale and retail trade growth moderated in April
Source: Department of Statistics, Malaysia
• The Index of Wholesale and Retail Trade
(IOWRT) expanded more moderately by 4.7% in
April 2023 (March 2023: 9.4%). The lower growth
was due mainly to the decline in the motor vehicle
segment.
• However, the retail segment continued to record a
double-digit growth of 10.0% (March 2023:
13.8%), supported by sales in non-specialised and
other specialised stores1.
• On a month-on-month seasonally adjusted basis,
the index increased at a faster pace of 6.5%
(March 2023: -0.9%).
1 Other goods in specialised stores includes clothing, footwear,
pharmaceuticals, cosmetics, watches, jewellery and optical goods.
10.6
9.4
4.7
-2
3
8
13
18
23
28
33
Apr-22 Jun-22 Aug-22 Oct-22 Dec-22 Feb-23 Apr-23
ppt, %yoy
Motor vehicles Retail Wholesale
Index of Wholesale and Retail Trade
Monthly Highlights
2
May 2023
Domestic financial markets were largely affected by external factors
Financial Market Performance in May 2023
-18.0
-0.5
-1.1
-3.0
-2.0
-3.4
10-year MGS
(bps, mom)
Equity
(%, mom)
Ringgit
(%, mom)
-20 -15 -10 -5 0
May-23 Apr-23
Note: The exchange rate data is the noon-rate in the Kuala Lumpur Interbank Foreign Exchange Market
1Regional countries comprise Singapore, Thailand, Philippines, Indonesia, and Korea
Source: Bank Negara Malaysia, Bursa Malaysia
• Global investors maintained a risk-off approach
throughout May, as concerns over the impact of the
US debt ceiling crisis and the weaker-than-
expected rebound in China’s economy weighed on
global financial markets.
• As a result, the ringgit depreciated against the US
dollar by 3.4% (regional1 average: -1.2%). Similarly,
the FBM KLCI declined by 2.0% (regional1 average:
-1.3%).
• Nonetheless, the 10-year MGS yields decreased
slightly by 3 basis points, supported by non-resident
inflows into the domestic bond market.
Banks maintained strong liquidity and funding positions to support intermediation
• Banks continued to record healthy liquidity buffers
with the aggregate Liquidity Coverage Ratio at
151.2% (April 2023: 154.3%).
• The aggregate loan-to-fund ratio remained stable at
81.8% (April 2023: 82.1%).
Source: Bank Negara Malaysia
Banking System Liquidity and Funding Ratios
81.8
151.2
0
40
80
120
160
70
75
80
85
90
95
M
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2
J
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2
J
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2
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2
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3
F
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2
3
M
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2
3
A
p
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2
3
M
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2
3
% %
Liquidity Coverage Ratio (RHS)
Loan-to-Fund Ratio
Asset quality in the banking system remained intact
Banking System Asset Quality
Source: Bank Negara Malaysia
• Overall gross and net impaired loans ratios
remained broadly unchanged at 1.80% (April
2023: 1.78%) and 1.10% (April 2023: 1.10%),
respectively.
• Loan loss coverage ratio (including regulatory
reserves) remained at a prudent level of 114.1%
of impaired loans, with total provisions accounting
for 1.7% of total loans.
%
1.8
1.1
1.7
0.5
1.0
1.5
2.0
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M
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2
3
Gross Impaired Loans Ratio
Total Provisions to Total Loans Ratio
Net Impaired Loans Ratio
April 2023 Monthly Highlights
Slide 1
Slide 2
| Press Release |
31 Jan 2024 | Detailed Disclosure of International Reserves as at end-December 2023 | https://www.bnm.gov.my/-/detailed-disclosure-of-international-reserves-as-at-end-december-2023-1 | null | null |
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Detailed Disclosure of International Reserves as at end-December 2023
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Detailed Disclosure of International Reserves as at end-December 2023
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Wednesday, 31 January 2024
31 Jan 2024
In accordance with the International Monetary Fund (IMF) Special Data Dissemination Standard (SDDS) format, the detailed breakdown of international reserves provides forward-looking information on the size, composition and usability of reserves and other foreign currency assets, and the expected and potential future inflows and outflows of foreign exchange of the Federal Government and Bank Negara Malaysia over the next 12-month period.
The detailed breakdown of international reserves based on the SDDS format is shown in Tables I, II, III and IV. As shown in Table I, official reserve assets amounted to USD113,478.1 million, while other foreign currency assets amounted to USD2.3 million as at end-December 2023.
As shown in Table II, for the next 12 months, the pre-determined short-term outflows of foreign currency loans, securities and deposits, which include among others, scheduled repayment of external borrowings by the Government and the maturity of foreign currency Bank Negara Interbank Bills, amounted to USD14,604.5 million. The net short forward positions amounted to USD23,569.2 million as at end-December 2023, reflecting the management of ringgit liquidity in the money market. In line with the practice adopted since April 2006, the data excludes projected foreign currency inflows arising from interest income and the drawdown of project loans. Projected foreign currency inflows amount to USD2,417.5 million in the next 12 months.
As shown in Table III, the only contingent short-term net drain on foreign currency assets is Government guarantees of foreign currency debt due within one year, amounting to USD369.4 million. There are no foreign currency loans with embedded options, and no undrawn, unconditional credit lines provided by or to other central banks, international organisations, banks and other financial institutions. Bank Negara Malaysia also does not engage in foreign currency options vis-à-vis ringgit.
Overall, the detailed breakdown of international reserves under the IMF SDDS format indicates that as at end-December 2023, Malaysia’s international reserves remain usable. Related Assets
International Reserves and Foreign Currency Liquidity (31 December 2023)
Bank Negara Malaysia
31 January 2024
© Bank Negara Malaysia, 2024. All rights reserved.
| null | Press Release |
26 Jan 2024 | Memorandum of Understanding between Bank Negara Malaysia and CyberSecurity Malaysia | https://www.bnm.gov.my/-/mou-csm | null | null |
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Memorandum of Understanding between Bank Negara Malaysia and CyberSecurity Malaysia
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Memorandum of Understanding between Bank Negara Malaysia and CyberSecurity Malaysia
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Friday, 26 January 2024
26 Jan 2024
Bank Negara Malaysia (BNM) and CyberSecurity Malaysia recently signed a Memorandum of Understanding (MoU) to strengthen cybersecurity measures in the nation’s financial system. This partnership allows BNM and CyberSecurity Malaysia to jointly develop robust cybersecurity strategies for Malaysia’s financial sector. It paves the way for seamless information sharing, exchange of best practices, and technical support to address emerging cyber risks. This will help safeguard the resilience of the financial sector and enhance its cybersecurity preparedness.
The MoU was signed by Bank Negara Malaysia Assistant Governor, Aznan Abdul Aziz, and Dato’ Ts. Dr. Haji Amirudin Abdul Wahab, Chief Executive Officer, CyberSecurity Malaysia. The signing of the MoU was witnessed by Encik Ma. Sivanesan Marimuthu, Deputy Secretary General, Ministry of Communications, Bank Negara Malaysia Deputy Governor, Datuk Jessica Chew Cheng Lian, and General Tan Sri Dato’ Sri (Dr.) Haji Zulkifeli bin Mohd Zin, Chairman of CyberSecurity Malaysia.
Assistant Governor Aznan Abdul Aziz said, “As the pace of digitalisation of financial services continues to accelerate, BNM continues to place a high priority on ensuring that financial institutions remain resilient against current and emerging cyber threats. This partnership with CyberSecurity Malaysia strengthens our combined incident response capabilities together with financial institutions and supports the proactive measures we are taking to preserve a safe and secure environment for development and innovation in the financial sector.”
“Cybersecurity is a fundamental component of today’s digital and hi-tech world. Other than technical issues that are widely discussed in the ICT domain, it also contributes to economic growth as well as human capability development. Undoubtedly, it is vital to address the vulnerabilities associated with recent technological advancements in order to establish a secure and safe workplace environment. Thus, today’s MoU defines a strategic partnership between two entities, alongside exchange of cyber threat intelligence to further enrich surveillance of the threat landscape between CyberSecurity Malaysia and the financial industry,” said Dato’ Ts. Dr Haji Amirudin Abdul Wahab, Chief Executive Officer of CyberSecurity Malaysia.
(from left) BNM Assistant Governor, Aznan Abdul Aziz, BNM Deputy Governor, Datuk Jessica Chew Cheng Lian, Deputy Secretary General, Ministry of Communications, Encik Ma. Sivanesan Marimuthu, Chairman of CyberSecurity Malaysia, General Tan Sri Dato’ Sri (Dr.) Haji Zulkifeli bin Mohd Zin and Chief Executive Officer of CyberSecurity Malaysia, Dato’ Ts. Dr. Haji Amirudin Abdul Wahab.
Bank Negara Malaysia
CyberSecurity Malaysia
26 January 2024
© Bank Negara Malaysia, 2024. All rights reserved.
| null | Press Release |
24 Jan 2024 | Monetary Policy Statement | https://www.bnm.gov.my/-/monetary-policy-statement-24012024 | https://www.bnm.gov.my/documents/20124/13235462/MPS_Snapshot_2024_01_en.pdf | null |
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Monetary Policy Statement
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Monetary Policy Statement
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24 Jan 2024
At its meeting today, the Monetary Policy Committee (MPC) of Bank Negara Malaysia decided to maintain the Overnight Policy Rate (OPR) at 3.00 percent.
The global economy continues to expand, driven by domestic demand amid strong labour market conditions. There are further signs of recovery in the electrical and electronics (E&E) sector, but global trade remains soft partly due to the continued shift in spending from goods to services, and ongoing trade restrictions. While China’s economy continues to show signs of improvement, its recovery remains modest given the weakness in the property market. Global headline and core inflation edged downwards in recent months but continue to be above average. On the global front, while the monetary policy stance is likely to remain tight in the near term, the tightening cycle has peaked for most central banks. The growth outlook remains subject to downside risks, mainly from an escalation of geopolitical tensions, higher-than-anticipated inflation outturns, and heightened volatility in global financial markets.
For the Malaysian economy, the fourth quarter advance estimates for GDP affirmed that the overall growth for 2023 expanded within expectations. Moving forward, growth is expected to improve in 2024, supported by the recovery in exports and resilient domestic expenditure. Continued employment and wage growth remain supportive of household spending. Tourist arrivals and spending are expected to improve further. Investment activity would be supported by continued progress of multi-year projects in both the private and public sectors, and implementation of catalytic initiatives under the national master plans. The growth outlook remains subject to downside risks stemming from weaker-than-expected external demand and larger declines in commodity production. Meanwhile, upside risks to growth mainly emanate from greater spillover from the tech upcycle, stronger-than-expected tourism activity and faster implementation of existing and new projects.
As expected, both headline and core inflation continued to moderate in the fourth quarter, mainly due to lower cost pressures amid stabilising demand conditions. Overall, both headline and core inflation for 2023 are within expectations, averaging for the year at 2.5% and 3.0%, respectively. In 2024, inflation is expected to remain modest, broadly reflecting stable cost and demand conditions. Risks to the inflation outlook remain highly subject to changes to domestic policy on subsidies and price controls, as well as global commodity prices and financial market developments. Of note, the Government’s intention to review price controls and subsidies in 2024 will affect the outlook for inflation and demand conditions.
The recent ringgit movements are primarily driven by external factors, and not reflective of the current domestic economic performance and prospects. As the risk of heightened volatility in the global financial and foreign exchange markets remains, Bank Negara Malaysia will continue to ensure sufficient liquidity to support the orderly functioning of the domestic foreign exchange market. Financial institutions continue to operate with strong capital and liquidity buffers, with domestic financial conditions remaining conducive to sustain credit growth.
At the current OPR level, the monetary policy stance remains supportive of the economy and is consistent with the current assessment of the inflation and growth prospects. The MPC remains vigilant to ongoing developments to inform the assessment on the outlook of domestic inflation and growth. The MPC will ensure that the monetary policy stance remains conducive to sustainable economic growth amid price stability.
See also:
Monetary Policy Statement (MPS) Snapshot: January 2024
Frequently Asked QuestionsBank Negara Malaysia
24 January 2024
© Bank Negara Malaysia, 2024. All rights reserved.
|
Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to Imports of Goods and Services
27Quarterly Bulletin | 4Q 2021
Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to
Imports of Goods and Services
One of the indicators used by the Bank to measure international reserve adequacy is the reserve coverage
of retained imports,1 which is communicated on a fortnightly basis. As the economy grew and evolved with
higher share of the services sector, this has raised the prominence of services imports in the measure of
reserve adequacy. Given this consideration and in line with the international best practice, future fortnightly
reporting of Malaysia’s international reserves will include the indicator on reserve coverage of imports of
goods and services, effective from 22 February 2022.2
1 Defined as gross imports subtracted with re-exports. The 12-month average retained imports can be derived from the Monthly Highlight and Statistics Table
3.6.8 (Imports by End-Use; see Appendix 1).
2 For the international reserves position as at 15 February 2022.
3 Defined as imports plus exports.
4 From RM101.3 billion to RM351.3 billion, or a compound annual growth rate (CAGR) of 6.4%.
5 Based on JP Morgan’s Government Bond Index for Emerging Markets.
Services tradeC1
0
100
200
300
400
1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021
RM billion
Travel1
Computer and information
Transport
Manufacturing
Other business3
Other2
Perdagangan perkhidmatanR1
0
100
200
300
400
1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021
RM bilion
Perjalanan1
Komputer dan informasi
Pengangkutan
Pembuatan
Perniagaan Lain3
Lain-lain2
Nota: Data sebelum tahun 2005 adalah berdasarkan garis panduan dalam Edisi Kelima Manual Imbangan Pembayaran dan Kedudukan
............Pelaburan Antarabangsa (BPM5) IMF. Data bagi tahun 2005 dan selanjutnya adalah berdasarkan BPM6.
1 Termasuk perbelanjaan perjalanan bagi aktiviti pelancongan.
2 Termasuk pembinaan, caj penggunaan harta intelek, perkhidmatan persendirian, kebudayaan dan rekreasi.
3 Perkhidmatan perniagaan lain termasuk perkhidmatan penyelidikan dan pembangunan, profesional, teknikal, berkaitan perdagangan dan
...perkhidmatan perniagaan lain.
Sumber: Jabatan Perangkaan Malaysia dan Bank Negara Malaysia
Note: Data prior to 2005 are based on the guideline in the Fifth Edition of the Balance of Payments and International Investment Position
............Manual (BPM5) of the IMF. Data for 2005 and beyond are based on BPM6.
1 Includes travel spending for tourism activity.
2 Includes construction, charges for intellectual property use, personal, culture & recreational services.
3 Other business services comprise research and development, professional, technical, trade-related and other business services.
Source: Department of Statistics, Malaysia and Bank Negara Malaysia
The Bank’s reporting of the reserve coverage of retained imports was published as early as in the 1990s. Data
on retained imports are available on monthly basis and thereby closely match the fortnightly release of the
international reserves data. However, retained imports do not include payment for services, which has grown
over the past two decades. From 1999 to 2019, services trade3 has increased by 246.9%4 (Chart 1). This was
mainly due to higher tourism activity as well as payments for foreign transport services for goods trade. In
addition, there was also an expansion in goods import, largely in support of domestic investment activities
and production of manufactured goods.
Malaysia’s performance on this indicator is in line with regional and peer5 economies. On historical basis,
reserve coverage of imports of goods and services indicator has been in the range of between 5 and 8
months since 2008 – well above the generally-accepted ‘rule of thumb’ adequacy threshold of 3-months, and
demonstrates the ability of the Malaysian economy to withstand against external shocks.
28 Quarterly Bulletin | 4Q 2021
It is also important to emphasize that the assessment of reserve adequacy should not be solely based
on the face value of these indicators. This needs to be complemented with deeper understanding about
the country’s external position, financial system and broad economic policies. In particular, international
reserves is not the only means to meet external obligations.6 Prevailing assessment indicates that the
country’s external position7 is underpinned by its strong economic fundamentals including healthy current
account surplus, large foreign currency external assets held by domestic entities8 and the flexible ringgit
exchange rate.
References
Department of Statistics, Malaysia. ‘External Sector’, Jabatan Perangkaan Malaysia, Putrajaya.
Greenspan, A., ‘Currency reserves and debt’. Remarks before the World Bank Conference on Recent Trends in
Reserves Management, Washington, DC, 29 April 1999.
International Monetary Fund, (2016). ‘Guidance Note on the Assessment of Reserve Adequacy and Related
Considerations’.
Appendix 1: Calculation of international reserves coverage of retained imports
aFor example, to calculate monthly retained imports for December 2019, the retained imports for the months of
January to December 2019 is summed up (i.e. rolling 12-months of retained imports). This number is then divided
by 12, to obtain a monthly average. The figures can be obtained from BNM’s MHS Table 3.6.8, column S.
6 Further information can be found in the box article “Malaysia’s Resilience in Managing External Debt Obligations and the Adequacy of International Reserves”
in BNM’s Annual Report 2018.
7 In addition, it has also been emphasized that Malaysia’s external debt position, including short-term external debt, remains manageable. This is supported by
the favourable currency and maturity profile on its external debt as well as domestic entities’ resilient repayment capacity. Foreign-currency external debt of
corporates are also mainly subject to prudential and hedging requirements (refer to the latest assessment on external debt developments on page 25)
8 Amounting to RM1.1 trillion as at end-2021.
| Press Release |
22 Jan 2024 | International Reserves of Bank Negara Malaysia as at 15 January 2024 | https://www.bnm.gov.my/-/international-reserves-of-bank-negara-malaysia-as-at-15-january-2024 | https://www.bnm.gov.my/documents/20124/6118085/qb2021q4_en_box_imports.pdf | null |
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International Reserves of Bank Negara Malaysia as at 15 January 2024
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International Reserves of Bank Negara Malaysia as at 15 January 2024
Embargo :
For immediate release
Not for publication or broadcast before
1500 on
Monday, 22 January 2024
22 Jan 2024
The international reserves of Bank Negara Malaysia amounted to USD115.1 billion as at 15 January 2024. The reserves level has taken into account the quarterly foreign exchange revaluation changes. The reserves position is sufficient to finance 5.4 months of imports of goods and services[1], and is 1.0 times of the total short-term external debt.
[1] Under the previous import coverage measure, reserves is sufficient to finance 6.9 months of retained imports of goods. For more information on the new indicator, please refer to the article on “Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to Imports of Goods and Services” in BNM’s Quarterly Bulletin for the Fourth Quarter of 2021 publication, page 27, which can be accessed at Quarterly Bulletin 4Q 2021. Related Assets
BNM Statement of Assets & Liabilities - 15 January 2024
Bank Negara Malaysia
22 January 2024
© Bank Negara Malaysia, 2024. All rights reserved.
|
Monthly Highlights
Headline inflation declined to 3.4% in March
March 2023
1
3.7 3.4
3.9 3.8
0.00
2.00
4.00
0.0
2.0
4.0
J
a
n
-2
2
F
e
b
-2
2
M
a
r-
2
2
A
p
r-
2
2
M
a
y
-2
2
J
u
n
-2
2
J
u
l-
2
2
A
u
g
-2
2
S
e
p
-2
2
O
c
t-
2
2
N
o
v
-2
2
D
e
c
-2
2
J
a
n
-2
3
F
e
b
-2
3
M
a
r-
2
3
Food & non-alcohol (29.5%) Housing & utilities (23.8%)
Transport (14.6%) Others (32.1%)
Headline inflation (RHS) Core inflation¹ (RHS)
Contribution to Inflation
ppt. contribution %, yoy
1 Core inflation is computed by excluding price-volatile and price-administered items.
Source: Department of Statistics, Malaysia & Bank Negara Malaysia estimates
• Headline inflation declined to 3.4% in March
(February: 3.7%) due mainly to lower inflation for
fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation moderated slightly to 3.8% during
the month (February: 3.9%), driven largely by
lower inflation for food away from home.
1
Robust growth in volume index driven by retail and motor vehicles
Index of Wholesale and Retail Trade
Source: Department of Statistics, Malaysia
• The Index of Wholesale and Retail Trade
(IOWRT) expanded by 10.6% in February 2023
(January: 8.5%).
• The higher growth was driven mainly by retail
sales in non-specialised stores (e.g., department
stores) followed by continued strength in
purchases of motor vehicles amid the ongoing
fulfilment of backlog orders.
• On a month-on-month seasonally adjusted basis,
the index accelerated by 5.5% (January: 0.2%).
9.5 8.510.6
0
10
20
30
40
Feb-
22
Mar-
22
Apr-
22
May-
22
Jun-
22
Jul-
22
Aug-
22
Sep-
22
Oct-
22
Nov-
22
Dec-
22
Jan-
23
Feb-
23
ppt, %yoy
Motor vehicles Retail Wholesale
2.4
5.2
4.4
0
1
2
3
4
5
6
7
Mar-22 Jul-22 Nov-22 Mar-23
Business loans
Household loans
Corporate bonds
Annual growth (%)
Growth in credit to the private non-financial sector moderated
1 Comprises loans to households and non-financial corporations from the
banking system and development financial institutions (DFIs), and corporate
bonds issued by non-financial corporations (including short-term papers).
2 Starting with the publication of December 2022 Monthly Highlights and
Statistics (MHS), this series was introduced to enhance the quality of
financing data. This new data series is available in the MHS Table 2.18.
Source: Bank Negara Malaysia
2.7 2.6 2.7 2.6
1.0 0.6 0.7 0.7
1.0
1.1 1.1 0.9
4.7 4.3 4.5 4.2
Dec-22 Jan-23 Feb-23 Mar-23
Corporate Bonds
Business Loans
Household Loans
Credit to the Private Non-
Financial Sector
Contribution to growth (ppt)
• Credit to the private non-financial sector grew by
4.2% as at end-March (February: 4.5%), attributed
to slower growth in credit to businesses (3.2%;
February: 3.7%).
• While growth in outstanding corporate bonds
moderated (4.4%; February : 5.5%), outstanding
business loan growth was sustained at 2.4%
(February: 2.4%). This was supported by the
continued growth in both working capital (2.2%;
February: 1.9%) and investment-related loans
(4.3%; February: 4.2%).
• Outstanding household loan growth remained
broadly stable (5.2%; February: 5.3%), supported
by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan
growth for the purchase of securities (-6.9%;
February: -3.3%).
Credit to the Private Non-Financial Sector1,2
Monthly Highlights
March 2023
Domestic financial market conditions remained orderly
Financial Market Performance in March 2023
Source: Bank Negara Malaysia, Bursa Malaysia
Note: The exchange rate data is the noon-rate in the Kuala Lumpur Interbank Foreign Exchange Market
11.0
-2.1
-5.3
0.0
-2.2
1.7
10-year MGS
(bps, mom)
Equity
(%, mom)
Ringgit
(%, mom)
-10 -5 0 5 10 15
Mar-23
Feb-23
• In March, global financial markets were affected by
the emergence of banking sector stress in some
major economies. As spillovers were contained thus
far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds
improved.
• In line with the performance of regional currencies,
the ringgit appreciated by 1.7% against the US
dollar. Conditions in the domestic bond market
also remained stable.
• The FBM KLCI declined by 2.2% during the month.
2
Banks maintained strong liquidity and funding positions to support intermediation
Source: Bank Negara Malaysia
Banking System Liquidity and Funding Ratios
81.9
157.4
0
40
80
120
160
70
75
80
85
90
95
M
a
r
2
2
A
p
r
2
2
M
a
y
2
2
J
u
n
2
2
J
u
l
2
2
A
u
g
2
2
S
e
p
2
2
O
c
t
2
2
N
o
v
2
2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
% %
Liquidity Coverage Ratio (RHS)
Loan-to-Fund Ratio
Asset quality in the banking system remained intact
Banking System Asset Quality
Source: Bank Negara Malaysia
• Overall gross and net impaired loans ratios
increased slightly to 1.8% (February-23: 1.8%) and
1.2% (February-23: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory
reserves) continue to record a prudent level of
110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
%
1.8
1.2
1.7
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
M
a
r
2
2
A
p
r
2
2
M
a
y
2
2
J
u
n
2
2
J
u
l
2
2
A
u
g
2
2
S
e
p
2
2
O
c
t
2
2
N
o
v
2
2
D
e
c
2
2
J
a
n
2
3
F
e
b
2
3
M
a
r
2
3
Gross Impaired Loans Ratio
Total Provisions to Total Loans Ratio
Net Impaired Loans Ratio
• Banks continued to record healthy liquidity buffers
with the aggregate Liquidity Coverage Ratio at
157.4% (February-23: 152.7%).
• The aggregate loan-to-fund ratio remained stable at
81.9% (February-23: 81.6%).
PRESS RELEASE
Ref. No.: 04/23/05 EMBARGO: Not for publication or
broadcast before 1500 hours on
Friday, 28 April 2023
Monthly Highlights – March 2023
Headline inflation declined to 3.4% in March
• Headline inflation declined to 3.4% in March (February: 3.7%) due mainly
to lower inflation for fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation1 moderated slightly to 3.8% during the month
(February: 3.9%), driven largely by lower inflation for food away from
home.
Robust growth in volume index driven by retail and motor vehicles
• The Index of Wholesale and Retail Trade (IOWRT) expanded by 10.6%
in February 2023 (January: 8.5%).
• The higher growth was driven mainly by retail sales in non-specialised
stores (e.g., department stores) followed by continued strength in
purchases of motor vehicles amid the ongoing fulfilment of backlog
orders.
• On a month-on-month seasonally adjusted basis, the index accelerated
by 5.5% (January: 0.2%).
1 Core inflation is computed by excluding price-volatile and price-administered items.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Growth in credit to the private non-financial sector2,3 moderated
• Credit to the private non-financial sector grew by 4.2% as at end-March
(February: 4.5%), attributed to slower growth in credit to businesses
(3.2%; February: 3.7%).
• While growth in outstanding corporate bonds moderated (4.4%;
February: 5.5%), outstanding business loan growth was sustained at
2.4% (February: 2.4%). This was supported by the continued growth in
both working capital (2.2%; February: 1.9%) and investment-related
loans (4.3%; February: 4.2%).
• Outstanding household loan growth remained broadly stable (5.2%;
February: 5.3%), supported by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan growth for the purchase of
securities (-6.9%; February: -3.3%).
Domestic financial market conditions remained orderly
• In March, global financial markets were affected by the emergence of
banking sector stress in some major economies. As spillovers were
contained thus far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds improved.
• In line with the performance of regional currencies, the ringgit
appreciated by 1.7% against the US dollar. Conditions in the domestic
bond market also remained stable.
• The FBM KLCI declined by 2.2% during the month.
Banks maintained strong liquidity and funding positions to support
intermediation
• Banks continued to record healthy liquidity buffers with the aggregate
Liquidity Coverage Ratio at 157.4% (February: 152.7%).
2 Comprises loans to households and non-financial corporations from the banking system and development financial
institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers).
3 Starting with the publication of December 2022 Monthly Highlights and Statistics (MHS), this series was introduced
to enhance the quality of financing data. This new data series is available in the MHS Table 2.18.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
• The aggregate loan-to-fund ratio remained stable at 81.9%
(February: 81.6%).
Asset quality in the banking system remained intact
• Overall gross and net impaired loans ratios increased slightly to 1.8%
(February: 1.8%) and 1.2% (February: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory reserves) continues to
record a prudent level of 110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
Bank Negara Malaysia
28 April 2023
20230428_BNM Monthly Highlights-March_en
Slide 1
Slide 2
20230428_BNM PR_Monthly Highlights-Mar 2023_eng
| Press Release |
22 Jan 2024 | Statement on Claims Relating to Quantum Metal Sdn. Bhd. | https://www.bnm.gov.my/-/pr-qmsb | https://www.bnm.gov.my/documents/20124/60360/Foreign+Exchange+Notices_Consolidated.pdf | null |
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Statement on Claims Relating to Quantum Metal Sdn. Bhd.
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228
Statement on Claims Relating to Quantum Metal Sdn. Bhd.
Embargo :
For immediate release
Not for publication or broadcast before
0900 on
Monday, 22 January 2024
22 Jan 2024
Bank Negara Malaysia (BNM) wishes to address and clarify several claims and misrepresentations of facts circulating within the public domain in relation to the affairs of Quantum Metal Sdn. Bhd. (QMSB).
QMSB is a reporting institution under the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001 (AMLA) as it deals in precious metals or precious stones, an activity listed as item 24 under Part 1 of the First Schedule of the AMLA along with other designated non-financial businesses and professions sectors such as lawyers, accountants, trust companies and company secretaries.
As a reporting institution, QMSB is obliged to undertake preventive measures to prevent its activities from being misused as a conduit for money laundering or terrorism financing activities.
However, being a reporting institution does not mean that QMSB’s products and business activities, such as gold products and trading, are registered, approved or licensed under laws administered by BNM. Any claims that QMSB’s activities are approved and licensed by BNM, directly or indirectly, are false.
BNM has also been made aware of various claims on social media that all incoming transactions outside of Malaysia needs the approval and verification of BNM in relation to AMLA. BNM wishes to clarify that any inflow of funds into the country, excluding those for offshore borrowing purposes exceeding the respective limits provided under the foreign exchange policies, does not require prior verification and approval from BNM.[1]
No person should misuse BNM’s name and correspondences that could invite misunderstanding that their products or services are approved by BNM. Any claims of association with BNM by any entity or individual should not be solely relied on in determining the legitimacy of such business.
BNM would like to remind the public to remain vigilant when making investment decisions. Any suspected unauthorised financial activities should be reported to the relevant law enforcement authorities.
See also:
AML/CFT regulation
Foreign exchange policy
List of Licensed Financial Institutions
[1] Foreign Exchange Policy Notices
Bank Negara Malaysia
22 January 2024
© Bank Negara Malaysia, 2024. All rights reserved.
|
Peluasan Ukuran Liputan Rizab Bagi Import – daripada Import Tertangguh kepada Import Barangan dan Perkhidmatan
27Buletin Suku Tahunan | S4 2021 27
Peluasan Ukuran Liputan Rizab Bagi Import – daripada Import Tertangguh kepada
Import Barangan dan Perkhidmatan
Salah satu penunjuk yang digunakan oleh Bank untuk mengukur kecukupan rizab antarabangsa ialah liputan
rizab bagi import tertangguh,1 yang disiarkan setiap dua minggu. Apabila ekonomi berkembang dengan bahagian
sektor perkhidmatan yang lebih besar, keadaan ini telah meningkatkan kepentingan import perkhidmatan
dalam pengukuran kecukupan rizab. Dengan mengambil kira perkara ini dan selaras dengan amalan terbaik
antarabangsa, laporan rizab antarabangsa Malaysia secara dwimingguan pada masa hadapan akan merangkumi
penunjuk tentang liputan rizab bagi import barangan dan perkhidmatan, berkuat kuasa mulai 22 Februari 2022.2
1 Ditakrifkan sebagai import kasar ditolak dengan eksport semula. Import tertangguh purata 12 bulan boleh didapati daripada Sorotan Bulanan dan Statistik,
Jadual 3.6.8 (Import oleh Pengguna Akhir; lihat Lampiran 1).
2 Bagi kedudukan rizab antarabangsa pada 15 Februari 2022.
3 Ditakrifkan sebagai import ditambah dengan eksport.
4 Daripada RM101.3 bilion kepada RM351.3 bilion, atau kadar pertumbuhan tahunan terkompaun (compound annual growth rate, CAGR) sebanyak 6.4%.
Services tradeC1
0
100
200
300
400
1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021
RM billion
Travel1
Computer and information
Transport
Manufacturing
Other business3
Other2
Perdagangan perkhidmatanR1
0
100
200
300
400
1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021
RM bilion
Perjalanan1
Komputer dan informasi
Pengangkutan
Pembuatan
Perniagaan Lain3
Lain-lain2
Nota: Data sebelum tahun 2005 adalah berdasarkan garis panduan dalam Edisi Kelima Manual Imbangan Pembayaran dan Kedudukan
............Pelaburan Antarabangsa (BPM5) IMF. Data bagi tahun 2005 dan selanjutnya adalah berdasarkan BPM6.
1 Termasuk perbelanjaan perjalanan bagi aktiviti pelancongan.
2 Termasuk pembinaan, caj penggunaan harta intelek, perkhidmatan persendirian, kebudayaan dan rekreasi.
3 Perkhidmatan perniagaan lain termasuk perkhidmatan penyelidikan dan pembangunan, profesional, teknikal, berkaitan perdagangan dan
...perkhidmatan perniagaan lain.
Sumber: Jabatan Perangkaan Malaysia dan Bank Negara Malaysia
Note: Data prior to 2005 are based on the guideline in the Fifth Edition of the Balance of Payments and International Investment Position
............Manual (BPM5) of the IMF. Data for 2005 and beyond are based on BPM6.
1 Includes travel spending for tourism activity.
2 Includes construction, charges for intellectual property use, personal, culture & recreational services.
3 Other business services comprise research and development, professional, technical, trade-related and other business services.
Source: Department of Statistics, Malaysia and Bank Negara Malaysia
Pelaporan Bank berhubung dengan liputan rizab bagi import tertangguh telah diterbitkan seawal tahun 1990-an.
Data bagi import tertangguh tersedia setiap bulan dan oleh itu sangat sepadan dengan siaran kedudukan
rizab antarabangsa setiap dua minggu. Walau bagaimanapun, import tertangguh tidak merangkumi bayaran
untuk perkhidmatan, yang telah berkembang sepanjang dua dekad yang lalu. Dari tahun 1999 hingga 2019,
perdagangan perkhidmatan3 telah meningkat sebanyak 246.9%4 (Rajah 1). Hal ini disebabkan terutamanya
oleh aktiviti pelancongan yang lebih tinggi serta pembayaran untuk perkhidmatan pengangkutan asing bagi
perdagangan barangan. Selain itu, import barangan juga berkembang, sebahagian besarnya bagi menyokong
aktiviti pelaburan dalam negeri dan pengeluaran barangan perkilangan.
28 Buletin Suku Tahunan | S4 202128
Prestasi Malaysia berhubung dengan penunjuk ini selaras dengan ekonomi serantau dan ekonomi yang
setara.5 Data sebelum ini menunjukkan liputan rizab bagi import barangan dan perkhidmatan berada dalam
julat antara lima hingga lapan bulan sejak tahun 2008. Paras ini jauh melebihi nilai ambang yang diterima
pakai secara meluas iaitu tiga bulan. Hal ini menunjukkan keupayaan ekonomi Malaysia untuk bertahan
daripada kejutan luaran.
Penting juga untuk ditekankan bahawa penilaian kecukupan rizab tidak seharusnya berdasarkan semata-
mata nilai muka penunjuk-penunjuk ini. Penilaian ini perlu dilengkapi dengan pemahaman yang mendalam
mengenai kedudukan luaran, sistem kewangan dan dasar ekonomi negara secara am. Khususnya, rizab
antarabangsa bukan sahaja cara untuk memenuhi obligasi luaran.6 Penilaian semasa menunjukkan
kedudukan luaran negara7 disokong oleh asas-asas ekonomi yang utuh termasuk lebihan akaun semasa
yang kukuh, aset luaran mata wang asing yang besar yang dipegang oleh entiti dalam negeri8 dan kadar
pertukaran ringgit yang fleksibel.
Rujukan
Department of Statistics, Malaysia. ‘External Sector’, Jabatan Perangkaan Malaysia, Putrajaya.
Greenspan, A., ‘Currency reserves and debt’. Remarks before the World Bank Conference on Recent Trends in
Reserves Management, Washington, DC, 29 April 1999.
International Monetary Fund, (2016). ‘Guidance Note on the Assessment of Reserve Adequacy and Related
Considerations’.
Lampiran 1: Pengiraan liputan rizab antarabangsa bagi import tertangguh
aSebagai contoh, untuk mengira import tertangguh setiap bulan bagi bulan Disember 2019, import tertangguh
bagi bulan Januari hingga Disember 2019 dicampurkan (iaitu import tertangguh bagi 12 bulan secara berturut-
turut). Jumlah ini kemudiannya dibahagikan dengan 12, bagi mendapatkan purata bulanan. Angka-angka
boleh didapati daripada Jadual 3.6.8, kolum S MHS yang dikeluarkan oleh BNM.
5 Berdasarkan JP Morgan’s Government Bond Index for Emerging Markets.
6 Maklumat lanjut boleh didapati dalam rencana “Daya Tahan Malaysia dalam Mengurus Obligasi Hutang Luar Negeri dan Kecukupan Rizab Antarabangsa” dalam
Laporan Tahunan BNM 2018.
7 Selain itu, turut diberikan penekanan ialah kedudukan hutang luar negeri Malaysia, termasuk hutang luar negeri jangka pendek, yang kekal terurus. Hal ini
disokong oleh profil mata wang dan tempoh matang yang bersesuaian terhadap hutang luar negeri serta daya tahan keupayaan bayaran balik pinjaman oleh
entiti dalam negeri. Hutang luar negeri dalam mata wang asing oleh syarikat-syarikat juga sebahagian besarnya tertakluk pada keperluan berhemat dan lindung
nilai (rujuk penilaian terkini tentang perkembangan hutang luar negeri di halaman [xx])
8 Berjumlah RM1.1 trilion pada akhir tahun 2021.
| Press Release |
08 Jan 2024 | International Reserves of Bank Negara Malaysia as at 29 December 2023 | https://www.bnm.gov.my/-/international-reserves-of-bank-negara-malaysia-as-at-29-december-2023 | https://www.bnm.gov.my/documents/20124/6118085/qb2021q4_en_box_imports.pdf | null |
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International Reserves of Bank Negara Malaysia as at 29 December 2023
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International Reserves of Bank Negara Malaysia as at 29 December 2023
Embargo :
For immediate release
Not for publication or broadcast before
1500 on
Monday, 8 January 2024
8 Jan 2024
The international reserves of Bank Negara Malaysia amounted to USD113.5 billion as at 29 December 2023. The reserves level has taken into account the quarterly foreign exchange revaluation changes. The reserves position is sufficient to finance 5.4 months of imports of goods and services[1], and is 1.0 time the total short-term external debt.
[1] Under the previous import coverage measure, reserves is sufficient to finance 7.0 months of retained imports of goods. For more information on the new indicator, please refer to the article on “Expansion of the Measure on Reserve Coverage of Imports – from Retained Imports to Imports of Goods and Services” in BNM’s Quarterly Bulletin for the Fourth Quarter of 2021 publication, page 27, which can be accessed at bnm.gov.my/-/quarterly-bulletin-4q-2021 Related Assets
BNM Statement of Assets & Liabilities - 29 December 2023
Bank Negara Malaysia
8 January 2024
© Bank Negara Malaysia, 2024. All rights reserved.
|
Monthly Highlights
Headline inflation declined to 3.4% in March
March 2023
1
3.7 3.4
3.9 3.8
0.00
2.00
4.00
0.0
2.0
4.0
J
a
n
-2
2
F
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b
-2
2
M
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2
2
A
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2
2
M
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-2
2
J
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-2
2
J
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2
2
A
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-2
2
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-2
2
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2
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-2
2
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-2
3
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-2
3
M
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2
3
Food & non-alcohol (29.5%) Housing & utilities (23.8%)
Transport (14.6%) Others (32.1%)
Headline inflation (RHS) Core inflation¹ (RHS)
Contribution to Inflation
ppt. contribution %, yoy
1 Core inflation is computed by excluding price-volatile and price-administered items.
Source: Department of Statistics, Malaysia & Bank Negara Malaysia estimates
• Headline inflation declined to 3.4% in March
(February: 3.7%) due mainly to lower inflation for
fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation moderated slightly to 3.8% during
the month (February: 3.9%), driven largely by
lower inflation for food away from home.
1
Robust growth in volume index driven by retail and motor vehicles
Index of Wholesale and Retail Trade
Source: Department of Statistics, Malaysia
• The Index of Wholesale and Retail Trade
(IOWRT) expanded by 10.6% in February 2023
(January: 8.5%).
• The higher growth was driven mainly by retail
sales in non-specialised stores (e.g., department
stores) followed by continued strength in
purchases of motor vehicles amid the ongoing
fulfilment of backlog orders.
• On a month-on-month seasonally adjusted basis,
the index accelerated by 5.5% (January: 0.2%).
9.5 8.510.6
0
10
20
30
40
Feb-
22
Mar-
22
Apr-
22
May-
22
Jun-
22
Jul-
22
Aug-
22
Sep-
22
Oct-
22
Nov-
22
Dec-
22
Jan-
23
Feb-
23
ppt, %yoy
Motor vehicles Retail Wholesale
2.4
5.2
4.4
0
1
2
3
4
5
6
7
Mar-22 Jul-22 Nov-22 Mar-23
Business loans
Household loans
Corporate bonds
Annual growth (%)
Growth in credit to the private non-financial sector moderated
1 Comprises loans to households and non-financial corporations from the
banking system and development financial institutions (DFIs), and corporate
bonds issued by non-financial corporations (including short-term papers).
2 Starting with the publication of December 2022 Monthly Highlights and
Statistics (MHS), this series was introduced to enhance the quality of
financing data. This new data series is available in the MHS Table 2.18.
Source: Bank Negara Malaysia
2.7 2.6 2.7 2.6
1.0 0.6 0.7 0.7
1.0
1.1 1.1 0.9
4.7 4.3 4.5 4.2
Dec-22 Jan-23 Feb-23 Mar-23
Corporate Bonds
Business Loans
Household Loans
Credit to the Private Non-
Financial Sector
Contribution to growth (ppt)
• Credit to the private non-financial sector grew by
4.2% as at end-March (February: 4.5%), attributed
to slower growth in credit to businesses (3.2%;
February: 3.7%).
• While growth in outstanding corporate bonds
moderated (4.4%; February : 5.5%), outstanding
business loan growth was sustained at 2.4%
(February: 2.4%). This was supported by the
continued growth in both working capital (2.2%;
February: 1.9%) and investment-related loans
(4.3%; February: 4.2%).
• Outstanding household loan growth remained
broadly stable (5.2%; February: 5.3%), supported
by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan
growth for the purchase of securities (-6.9%;
February: -3.3%).
Credit to the Private Non-Financial Sector1,2
Monthly Highlights
March 2023
Domestic financial market conditions remained orderly
Financial Market Performance in March 2023
Source: Bank Negara Malaysia, Bursa Malaysia
Note: The exchange rate data is the noon-rate in the Kuala Lumpur Interbank Foreign Exchange Market
11.0
-2.1
-5.3
0.0
-2.2
1.7
10-year MGS
(bps, mom)
Equity
(%, mom)
Ringgit
(%, mom)
-10 -5 0 5 10 15
Mar-23
Feb-23
• In March, global financial markets were affected by
the emergence of banking sector stress in some
major economies. As spillovers were contained thus
far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds
improved.
• In line with the performance of regional currencies,
the ringgit appreciated by 1.7% against the US
dollar. Conditions in the domestic bond market
also remained stable.
• The FBM KLCI declined by 2.2% during the month.
2
Banks maintained strong liquidity and funding positions to support intermediation
Source: Bank Negara Malaysia
Banking System Liquidity and Funding Ratios
81.9
157.4
0
40
80
120
160
70
75
80
85
90
95
M
a
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2
2
A
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2
M
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2
2
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2
J
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2
A
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2
2
S
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2
O
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2
2
N
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2
D
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2
2
J
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2
3
F
e
b
2
3
M
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2
3
% %
Liquidity Coverage Ratio (RHS)
Loan-to-Fund Ratio
Asset quality in the banking system remained intact
Banking System Asset Quality
Source: Bank Negara Malaysia
• Overall gross and net impaired loans ratios
increased slightly to 1.8% (February-23: 1.8%) and
1.2% (February-23: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory
reserves) continue to record a prudent level of
110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
%
1.8
1.2
1.7
0.6
0.8
1.0
1.2
1.4
1.6
1.8
2.0
M
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2
2
A
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2
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2
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3
F
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2
3
M
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2
3
Gross Impaired Loans Ratio
Total Provisions to Total Loans Ratio
Net Impaired Loans Ratio
• Banks continued to record healthy liquidity buffers
with the aggregate Liquidity Coverage Ratio at
157.4% (February-23: 152.7%).
• The aggregate loan-to-fund ratio remained stable at
81.9% (February-23: 81.6%).
PRESS RELEASE
Ref. No.: 04/23/05 EMBARGO: Not for publication or
broadcast before 1500 hours on
Friday, 28 April 2023
Monthly Highlights – March 2023
Headline inflation declined to 3.4% in March
• Headline inflation declined to 3.4% in March (February: 3.7%) due mainly
to lower inflation for fuel, air fares and selected food items, in line with
the easing global commodity prices.
• Core inflation1 moderated slightly to 3.8% during the month
(February: 3.9%), driven largely by lower inflation for food away from
home.
Robust growth in volume index driven by retail and motor vehicles
• The Index of Wholesale and Retail Trade (IOWRT) expanded by 10.6%
in February 2023 (January: 8.5%).
• The higher growth was driven mainly by retail sales in non-specialised
stores (e.g., department stores) followed by continued strength in
purchases of motor vehicles amid the ongoing fulfilment of backlog
orders.
• On a month-on-month seasonally adjusted basis, the index accelerated
by 5.5% (January: 0.2%).
1 Core inflation is computed by excluding price-volatile and price-administered items.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
Growth in credit to the private non-financial sector2,3 moderated
• Credit to the private non-financial sector grew by 4.2% as at end-March
(February: 4.5%), attributed to slower growth in credit to businesses
(3.2%; February: 3.7%).
• While growth in outstanding corporate bonds moderated (4.4%;
February: 5.5%), outstanding business loan growth was sustained at
2.4% (February: 2.4%). This was supported by the continued growth in
both working capital (2.2%; February: 1.9%) and investment-related
loans (4.3%; February: 4.2%).
• Outstanding household loan growth remained broadly stable (5.2%;
February: 5.3%), supported by growth in loans for car purchases (8.7%;
February: 7.6%). This was amid weaker loan growth for the purchase of
securities (-6.9%; February: -3.3%).
Domestic financial market conditions remained orderly
• In March, global financial markets were affected by the emergence of
banking sector stress in some major economies. As spillovers were
contained thus far due to early action by authorities, investors’ risk
appetite for emerging market currencies and bonds improved.
• In line with the performance of regional currencies, the ringgit
appreciated by 1.7% against the US dollar. Conditions in the domestic
bond market also remained stable.
• The FBM KLCI declined by 2.2% during the month.
Banks maintained strong liquidity and funding positions to support
intermediation
• Banks continued to record healthy liquidity buffers with the aggregate
Liquidity Coverage Ratio at 157.4% (February: 152.7%).
2 Comprises loans to households and non-financial corporations from the banking system and development financial
institutions (DFIs), and corporate bonds issued by non-financial corporations (including short-term papers).
3 Starting with the publication of December 2022 Monthly Highlights and Statistics (MHS), this series was introduced
to enhance the quality of financing data. This new data series is available in the MHS Table 2.18.
P u b l i s h e d b y :
S t r a t e g i c C o m m u n i c a t i o n s D e p a r t m e n t , L e v e l 1 4 , B l o c k B , B a n k N e g a r a M a l a y s i a ,
J a l a n D a t o ’ O n n , 5 0 4 8 0 K u a l a L u m p u r , M a l a y s i a .
E - m a i l : c o m m u n i c a t i o n s @ b n m . g o v . m y
W e b : w w w . b n m . g o v . m y
• The aggregate loan-to-fund ratio remained stable at 81.9%
(February: 81.6%).
Asset quality in the banking system remained intact
• Overall gross and net impaired loans ratios increased slightly to 1.8%
(February: 1.8%) and 1.2% (February: 1.1%), respectively.
• Loan loss coverage ratio (including regulatory reserves) continues to
record a prudent level of 110.5% of impaired loans, with total provisions
accounting for 1.7% of total loans.
Bank Negara Malaysia
28 April 2023
20230428_BNM Monthly Highlights-March_en
Slide 1
Slide 2
20230428_BNM PR_Monthly Highlights-Mar 2023_eng
| Press Release |