KUALA LUMPUR, July 30 (Bernama) -- Bursa Malaysia's key index closed at an intraday high today, supported by continued buying interest even as renewed geopolitical tensions and a weaker overnight lead from Wall Street following the US Federal Reserve's (Fed) decision to stand pat on interest rates weighed on broader sentiment. The Fed has decided to hold rates steady for the fifth consecutive meeting, with the Federal Funds Rate unchanged between 3.50 per cent and 3.75 per cent. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) rose 4.84 points to 1,720.40 from yesterday’s close of 1,715.56. The benchmark index, which opened 1.14 points lower at 1,714.42, hit its lowest level of 1,710.69 in early trade before gaining momentum for the rest of the day. However, the broader market was negative with losers outpacing gainers 581 to 411, while 612 counters were unchanged, 1,173 untraded, and 87 suspended. Turnover declined to 2.49 billion units valued at RM2.25 billion from ...
China is fueling optimism for further economic stimulus after the People's Bank of China (PBOC) cut a key short-term policy rate and announced a rare briefing by top financial regulators. The central bank reduced the 14-day reverse repurchase rate by 10 basis points to 1.85%, signaling the potential for additional monetary easing as authorities work to revive economic growth.
The briefing, scheduled for tomorrow, will feature PBOC Governor Pan Gongsheng and two other senior officials discussing financial support for economic development. This comes amid concerns that China may miss its annual growth target of around 5% without further intervention, especially following a string of disappointing economic data in August.
The moves have heightened expectations for the PBOC to cut rates further, especially after the US Federal Reserve initiated rate cuts last week. The yield on China’s 10-year government bonds dropped to a fresh low of 2.03%, and the PBOC raised its daily reference rate for the yuan to 7.0531 per dollar, drawing closer to a key exchange rate threshold.
Economists, including Zhiwei Zhang of Pinpoint Asset Management, expect the PBOC to lower the seven-day repo rate and the reserve requirement ratio (RRR) in the coming months. The PBOC also has the opportunity to reduce its one-year policy loans on Wednesday, further bolstering monetary support.
These steps, which include a 74.5 billion yuan (US$10.6 billion) liquidity injection, come ahead of the National Day Holiday, a seven-day break beginning October 1. Economists like Raymond Yeung of ANZ believe that while the recent rate cut is a step forward, a larger stimulus package will likely be required to sustain economic momentum, with potential further cuts to the RRR, Medium-Term Lending Facility (MLF), and mortgage rates anticipated.
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