Finally, the much-awaited Chinese Lunar New Year season is here as amply evidenced by the images of the cheerful and cuddly rabbit seemingly everywhere.
Yet, the thing that might be "hopping" inside many people's minds, even while they are in the midst of tossing yee sang, could be - "will there be another round of the OPR (Overnight Policy Rate) hike by Bank Negara Malaysia soon!?"
Currently at 2.75 percent, talk had been rife that it would soon be increased by another 0.25 basis points, bringing it up to the pre-pandemic level of 3.00 percent… maybe even higher!
This of course may end up delivering a "knockout blow" to the thousands of households in the country as it would trigger a sudden surge in their monthly loan repayment expenditures.
To give a rough idea, those who had applied for a home loan in 2020 with an instalment of say, rm1,150.00, could soon be paying well above rm1,350.00. That's a whopping increase of minimum RM200.00 per month!
Strangely though, the reason often given by the authorities for OPR hikes is that it is a necessary monetary tool to bring down inflation in a country and to stabilize the local currency. Are they serious?
If anything, it has only left the "man on the street" and academicians alike, scratching their heads madly. Why? Because the results and evidence on the ground have proven to be otherwise.
Professor Geoffrey Williams of Malaysia University of Science and Technology appeared to hit the nail on the head when he pointed out recently in FMT that it's apparently driven by the belief that just because the US Federal Reserve increases their rate to bring down inflation in the US, we must also follow suit. (Excuse me, are we a twin-brother to them or what?)
Furthermore, according to him, the situation in our country is different from the US because over here price controls and subsidies have been much more effective than interest rates in keeping our inflation below our regional peers.
The new unity government under PM Anwar Ibrahim has also wisely and correctly decided not to increase utility tariffs on households and 98% of businesses.
To add to that, of course, oil prices are back to levels seen in January last year and significantly China has started to "reopen." Ringgit has also been gradually strengthening against the greenback.
With all these favorable factors in the bag, what then is spooking the authorities? Too much of Bloomberg? Or is it an obsession with economic theories and historical financial data?
There is a popular saying that the devil is in the detail. Well, not anymore, because now in the digital age, the devil is actually in the data. Don't believe it? Ask the scammers!
For the record, though there were four rounds of OPR hikes in 2022, did they produce the desired effect?
As it turned out, even "budget beverages" at the mamak such as teh tarik, kopi-o and teh halia (to name just three) saw prices spiralling upwards.
In fact, even the price of our humble "national snacks" such as pisang goreng and karipap increased while mysteriously in some places, their size also appeared to have shrunk! And we haven't even mentioned roti canai, nasi lemak, and wantan mee yet!
Honestly, now, can we blame the ordinary man for suspecting that the OPR hike is actually a devious plot to boost our local banks' profits and to protect the local share market and its investors?
So that the rich can continue to draw handsome dividends to finance their year-end vacation to the UK or Europe - at the expense of the millions of helpless have-nots, of course?
To underscore the point, Malaysia Now also reported that another banking veteran Muhammad Zahid Abdul Aziz (formerly of Bank Islam) had mentioned that Bank Negara's manipulation of the OPR rate to control inflation would be plainly pointless.
Now, after all these countless well-meaning advice from local experts will Bank Negara finally "turun padang" and accept reality... or will they still dance to the tune of the distant "howlings" from Wall Street?
The past few years have been a horrendous journey for many, with the insane so-called MCOs (movement control orders), the crippling Covid-19 pandemic, the endless political shenanigans, the loss of jobs, and the ever-rising prices of practically everything under the sun... and inside the shops too!
So, can Bank Negara Malaysia kindly stop being a killjoy and spare the "rabbit"... so that everyone in this country can enjoy "longevity, peace, and prosperity" together, this year.
"Xin Nian Kuai Le" to everyone!
JK Joseph is a content creator under the Newswav Creator programme, where you get to express yourself, be a citizen journalist, and at the same time monetize your content & reach millions of users on Newswav. Log in to creator.newswav.com and become a Newswav Creator now!
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