Well, cutting rates usually indicate a slowing down of economic activities or even a potential slowdown in the near future. Thus, instead of cutting 50 basis points later, the central bank may prefer to lengthen this whole process and just cut 25 basis points earlier and another 25 basis points later. Who knows, maybe this 25 basis point could have the right effects on the economy and no further rate cuts are needed?
Let’s just say that I do not agree if people were to buy a property at a price way above what they could afford because they believe they will get a lifeline from the government if something goes wrong along the way. If I could be happy to buy an apartment in a less prime area when I was much younger, why must the buyers of today only wanting to buy a condo instead? Or only want that certain area and thus having to pay a higher premium instead? They deserve something MORE than me? So, please just buy within your means and budget. Period.
Knight Frank Malaysia acknowledges the government’s ongoing commitment to fostering inclusive growth, particularly through strategic infrastructure initiatives and sustainability measures outlined in Budget 2025.
“This is a record-setting budget, but it is focused on efficiency and investment,” Mr. Ansari said. “We believe the country will harvest the benefits of this focus over the long-term in the form of faster
economic growth and real estate gains.
Before the arrival of Covid-19, Malaysia has these numbers when it comes to tourism. “A total of 26,100,784 international tourists visited Malaysia in 2019 compared to 25,832,354 in 2018. Meanwhile, tourist expenditure in 2019 rose by 2.4% to RM86. 1 billion compared to RM84.” Source: tourism.gov.my. We know, tourist numbers fell tremendously when Covid arrived in all countries. So, has the numbers recovered already for Malaysia? Are we again earning huge tourism revenues?
It has been a never-ending positive story for ringgit thus far, at least for the past many weeks. Every other week, we see the ringgit appreciating (actually it’s more of US$ depreciating) and then more good news come. Then, the following week, ringgit reaches a new high versus US$ and then we read more predictions / forecasts. Now, the latest one I read is that by the end of 2024, we will reach RM3.80 to US$1. This is like wow…
I repeat something that I have always been telling people and it’s very obvious from my writings. Currency movement should just be valued based on trade; surplus or deficit. If you have deficits year after year, why is your currency appreciating? No one wants to buy your goods and you have to keep buying other people’s currency because you needed their goods! Oh… the trades were done using a specific currency. No wonder.
Bank Negara Malaysia says it wants to be accommodative to economic growth as one of the reason it maintained the OPR. I think this is a healthy rate. I just hope the Federal Reserve of the US will reduce their rates and continue to do so a few more times until the differential with our OPR is very close. Currently, still some distance away. This news was yesterday:
Some of us get very worried even if interest rate rises just 50 basis points. For a RM500,000 home, a rise of 50 basis points or 0.5% is equivalent to a difference of an extra RM134.95 per month. This is why we should not over-stretch yeah. Alternatively to make up RM135 per month, we only need to reduce a total of 8-9 times from ordering a latte in Starbucks. Or eat bread for 3 days versus a typical RM45 dinner per time. Realistic right?
Two things we cannot run away from. Death and Taxes. I am very sure people intend to pay tax if they earn higher than the tax threshold. However, for some who’s doing a small business, it’s not easy for the tax department to keep track on whether the small business owner should pay tax or not. No tax is applicable if the earning is low. No tax is applicable if the business is suffering losses too.
CIMB Group Holdings Bhd is predicting that the ringgit will continue to strengthen and they have forecasted the ringgit to hit US$1 to RM4.22 level within 2024. Just imagine within the past 12 months, there has even been predictions that ringgit may reach RM5 to US$1 and now the prediction is for RM4.22 level. Just remember, this is because the US$ is depreciating because the Federal Reserve (BNM equivalent in the US) may be deciding to cut their rates. With this expectation, US$ has started its drop for weeks now.
The definition of “High-income countries are those with a GNI per capita of more than $14,005 in 2023” Source: ourworldindata.org. Thus, if we currently earn RM61,000 per higher per year, we are considered as having an income which is high income versus the world today. While this does not seem to be a lot but the truth is, there are many countries with far lower per capita income yeah. As for whether we could become a millionaire, well, most millionaires become one through owning a property. Perhaps you can start the journey too.