Malaysia

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In line with our view, Bank Negara Malaysia (BNM) kept its key Overnight Policy Rate steady at 3.50% at its latest monetary policy meeting on April 29. In the accompanying monetary policy statement, BNM drew attention to both the downside risks to economic growth, associated with 'a moderation of economic activity' across 'the major industrial economies', and the upside risks to inflation, due to the 'structural phenomenon' of higher global food prices. This suggests that the bank will continue to weigh both risks against each other by keeping rates on hold, until one becomes more prominent.