LETTERS: Bank Negara Malaysia (BNM) should exercise caution before implementing another Overnight Policy Rate (OPR) increase, which will have a negative effect on consumers and businesses.
FIRST, the rise in OPR would have an immediate effect on homeowners, adding to their financial burden.
Consumers will have to make larger monthly payments as a result of the increase in OPR as the world had just begun to recover from the economic contraction brought on by Covid-19.
It is also important to realise that some home owners purchased their houses to rent them out. This will have an effect on tenants as well, particularly young professionals who have just gained employment, and the M40 and B40 categories.
SECOND, another OPR increase would spike the cost of doing business for small- and medium-sized enterprises (SMEs).
For businesses in the food industry, the rise in OPR would add to the rise in fertiliser prices and logistic costs, pushing up food prices further.
In this regard, the government must implement targeted cash assistance programmes for B40 households such as food vouchers and more incentives for businesses that could boost domestic output.
AHMAD HAZIM SHABARUDDIN
International Islamic University of Malaysia
The views expressed in this article are the author's own and do not necessarily reflect those of the New Straits Times