Key events to watch this week include Bank Negara Malaysia’s announcement of third-quarter gross domestic product data on Friday, and Singles’ Day — the world’s largest online and in-store shopping event — on Monday.

Malaysia’s 3Q economic growth is widely expected to have slowed, with a Bloomberg survey showing that economists expect it to come in at 4.4% year on year compared with 4.9% y-o-y in the second quarter. The economy grew 4.5% y-o-y in the first quarter.

Just last Tuesday, Bank Negara kept the overnight policy rate unchanged at 3% after its final monetary policy meeting for the year. Three days later, on Friday, it announced it would lower the statutory reserve requirement (SRR) ratio to 3% from 3.5% effective Nov 16, in a move to maintain sufficient liquidity in the domestic financial system.

AmBank Research, in a May 29 report, estimated that a 50 basis point reduction in the SRR should help release about RM7 billion of liquidity into the system. The last time the central bank made any adjustment to the SRR was in 2016, when the ratio was lowered by 50bps from 4% effective February that year.

“The risk in cutting the SRR is that the funds released could find their way more into the financial markets and less into the real economy through lending. This happened in 2016. The SRR cut [at that time] failed to support lending and instead favoured the bond market, with loans continuing to head south while bonds benefited. Savings picked up,” the research house says in the report, predicting that there would be a cut in the SRR.

It added: “Such a trend could take place this time around with overall business and consumer sentiments softening and savings on an upward trend. Such a setting, if it continues, is expected to reduce the effectiveness of the ‘monetary multiplier’.”

The announcement of the SRR cut last Friday boosted investor sentiment and helped the benchmark FBM KLCI close the day marginally higher, by 0.02% to 1,609.73 points, after spending much of the day in the red.

The Department of Statistics Malaysia will release the September industrial production index data, a measure of manufacturing output, on Monday.

The 1Malaysia Development Bhd-Tanore trial will resume on Monday. Separately, High Court judge Justice Mohd Nazlan Mohd Ghazali is to decide on the same day whether former prime minister Datuk Seri Najib Razak must enter his defence in the SRC International Sdn Bhd case.

On Wednesday, High Court judge, Justice Mohamed Zaini Mazlan, will decide whether the 1MDB audit report tampering trial involving Najib and the fund’s former CEO Arul Kanda Kandasamy can begin on Jan 13 next year.

Singles’ Day, which falls on Nov 11, will be keenly watched as a gauge of the economy’s health. The 24-hour shopping event was introduced by China’s Alibaba Group in 2009 as a means for singles to celebrate their singledom by buying things online at sharp discounts. It has since evolved, having spread to other countries and e-commerce sites and stores.

Last year, Alibaba’s Singles’ Day event hit US$30.8 billion in gross merchandise value (GMV), in yet another record performance. However, the 27% y-o-y growth was the lowest in the event’s history.

US-China trade developments will continue to be in focus, with both sides still in discussion last week about which country Presidents Donald Trump and Xi Jinping should meet in to sign a “Phase 1” trade agreement.

Last week, officials from China and the US said they would roll back tariffs on each other’s goods if the Phase 1 trade deal is completed, but some in the White House insisted no final decision had been reached yet, Reuters reported on Nov 7.

Over in the US, the first public hearings of Trump’s impeachment inquiry will be aired on television this week. Three US diplomats who expressed concern about his dealings with the Ukraine — namely William Taylor, George Kent and former US ambassador to Ukraine Marie Yovanovitch — will be the star witnesses.

The UK and Japan are also expected to release preliminary 3Q GDP data, on Monday and Thursday respectively. According to a Bloomberg poll, the UK’s 3Q growth is expected to rebound to 0.4% quarter on quarter from -0.2% q-o-q in 2Q. However, on a y-o-y basis, growth is seen easing further to 1.1% from 1.3%.

As for Japan, 3Q growth is expected to slow further to 0.9% q-o-q on a seasonally adjusted basis, from 1.3% q-o-q in 2Q.

Central banks with monetary decisions this week include The Reserve Bank of New Zealand (Wednesday) and the Central Bank of the Philippines (Thursday).

Back home, companies with annual general meetings in­­­clude Malaysian Genomics Re­source Centre Bhd (Tuesday),

Dialog Group Bhd (Wednesday) and Sime Darby Bhd (Thursday).