PETALING JAYA: The statutory reserve requirement (SRR) ratio will unlikely see any cut this year amid the economy showing signs of sluggishness over the next couple of months underpinned by ample liquidity in the banking system.
SRR is non-interest bearing balances that commercial banks are required to keep with the central bank. It is also an instrument to manage liquidity.
A lower SRR would mean a lower amount to be set aside and this would reduce the banks’ cost of funds as the excess funds could be used for lending purposes.
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