Loan growth is expected to register between 4% to 5% in 2022 (2021: 4.5%; 2020: 3.4%), Kenanga Research said in a note
The research house said that It attributes this to the projected expansion in GDP growth (5.5% -6.0%) and an improving domestic COVID-19 situation that should continue to expand household and business confidence
It said that additionally, loans may be lifted by an extended period of low-interest rates as BNM takes a cautious approach towards monetary policy direction.
Nonetheless, downside risks remain amid the global spread of the Omicron variant and its exacerbation of supply chain disruptions.
Kenanga continues to expect BNM to keep the policy rate unchanged at 1.75% until at least 3Q22, to ensure the country’s economic recovery and as inflation remains modest for the time being.
