KUALA LUMPUR, Nov 6 (Bernama) -- Bursa Malaysia closed higher today, buoyed by supportive local economic policies, positive sentiment from strong technology stocks earnings, and a favourable United States (US) market outlook, an analyst said. Add to that, Bank Negara Malaysia’s (BNM) decision to maintain the Overnight Policy Rate (OPR) at 3.0 per cent is poised to encourage domestic spending and investment. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) rose 13.47 points, or 0.83 per cent, to close at its intraday high of 1,634.17, compared to Tuesday’s close of 1,620.70. The benchmark index opened 3.71 points higher at 1,624.41 and subsequently hit a low of 1,623.52 in early trade before trending upwards toward the closing session. Market breadth was positive, with advancers trumping decliners 849 to 352, while 428 counters were unchanged, 765 untraded, and nine suspended. Turnover expanded to 3.39 billion units
Gabriel Makhlouf, a member of the European Central Bank's (ECB) Governing Council, emphasized that significant interest rate cuts should only be considered under exceptional circumstances. Speaking on the sidelines of the International Monetary Fund's annual meetings in Washington, Makhlouf suggested that policymakers should be cautious to ensure inflation stays on track to meet the 2% target.
He noted that while the ECB may not need to maintain high rates to restrict the economy anymore, significant cuts would only be justified by “very powerful” data. According to Makhlouf, drastic moves such as a 50 basis point rate cut should be reserved for situations akin to a "big catastrophe" or other urgent economic data.
His comments come amid ongoing discussions about whether the ECB should consider a larger-than-usual rate cut at its next meeting in December, as the euro area economy struggles to regain momentum. While France and Germany are particularly weak, services inflation, which slowed to 3.9% last month, remains a concern.
Makhlouf acknowledged the economic slowdown but advised against expecting too much from monetary policy, noting that broader economic challenges, especially in some of the bloc's largest economies, need to be addressed beyond central bank measures. He downplayed the potential impact of the US presidential election on the global economy, stating that issues like trade fragmentation have been ongoing and may not change significantly regardless of the outcome.
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