Introduction to the Asian Economic Calendar
A busy but short week lies ahead on the Asian economic calendar, with Bank Negara Malaysia taking centre stage as the sole regional central bank announcing a monetary policy decision. The week is shortened due to Malaysia observing public holidays on Monday, September 1, for Merdeka Day, and on Friday, September 5, for Prophet Muhammad’s birthday.
Monetary Policy Decision by Bank Negara Malaysia
Bank Negara is set to deliver its overnight policy rate (OPR) decision on Thursday, September 4. Consensus expectations point to no change, with DBS Economics and Strategy Research expecting the central bank to leave the policy rate unchanged at 2.75% during its September meeting. This follows a pre-emptive 25-basis-point cut in July. UOB economists Julia Goh and Jasrine Loke also expect Bank Negara to hold rates steady, citing the need for further assessment of global risks and domestic factors such as benign inflation and resilient growth.
Global Risks and Domestic Factors
The external landscape remains clouded by ongoing threats of US sectoral tariffs on semiconductors, despite some clarity on US reciprocal tariffs since July. Malaysia’s external-oriented economy is bracing for an export slowdown in the second half of 2025. However, Bank Negara governor Datuk Seri Abdul Rasheed Ghaffour stated that the recent OPR cut would provide an additional lift to domestic growth, suggesting a lack of urgency to ease monetary policy in the absence of severe growth shocks.
Space for Accommodative Monetary Policy
Amid modest inflation prospects and a highly uncertain global environment threatened by the US tariff roller coaster, there is still space for Bank Negara to leave the door open for more accommodative monetary policy. This approach allows for flexibility in response to changing economic conditions while maintaining support for domestic growth.
Corporate Calendar and Earnings Season
Malaysia’s corporate calendar is expected to remain subdued this week, with the second-quarter earnings season having concluded last week. The second meeting of the fourth session of the 15th parliament concluded last Thursday with the passing of 19 bills, including the landmark Gig Workers Bill 2025. The next sitting will be held from October 6 to December 4.
International Events and Summits
This week’s highlight will also be the Shanghai Cooperation Organisation (SCO) summit in Tianjin, China, which took place on August 31 and September 1. Key leaders, including China’s President Xi Jinping, India’s Prime Minister Narendra Modi, and Russia’s President Vladimir Putin, attended the summit. The focus was on any joint statement by the grouping in view of lingering hostilities against the US following President Donald Trump’s imposition of tariffs on its trade partners.
Economic Data and Reports
Across Southeast Asia, inflation data from Indonesia, the Philippines, and Thailand will be closely watched. S&P Manufacturing Purchasing Managers’ Indices (PMI) for August will be released globally, including for Malaysia, Thailand, Indonesia, Vietnam, and Singapore in this region. Indonesia and Vietnam are also scheduled to release July trade data.
Developed Markets and US Economic Calendar
In the developed markets, the US and Canada were closed on Monday for Labor Day. The US economic calendar picks up later in the week, with August’s ISM Services Index due on Thursday, followed by the closely watched non-farm payrolls report on Friday. This report is set to provide a key signal for US Federal Reserve policy, with the Fed’s Federal Open Market Committee due to meet on September 16 and 17. The US corporate earnings season continues, with 252 US companies reporting their earnings, including six S&P 500 companies.
Conclusion
In conclusion, the Asian economic calendar for the week is marked by significant events, including the monetary policy decision by Bank Negara Malaysia and the Shanghai Cooperation Organisation summit. The week also sees the release of important economic data and reports, both regionally and globally. As the global economy navigates through uncertainties and challenges, these events and data releases will provide valuable insights into the economic outlook and potential future developments.
