As per the media reports, the stronger signs of economic troughs have led to keeping the interest rates unchanged at 2% by Bank Negara. The revelation was made today at the monetary policy meeting.

In an e-mail, CIMB Investment Bank Bhd economic research head Lee Heng Guie specified, "Given more signs of improvement in both domestic and external conditions, we believe Bank Negara prefers to sit tight, allowing the impact of previous rate reductions and accelerating fiscal pump priming to flow through the economy."

An agreeing nod was even given by Bank Islam Malaysia Bhd senior economist, Azrul Azwar, for the same. He did add that the central bank might not agree to "overshoot" in using interest rates to promote growth. However, further cuts were implanted by deflationary trends in the last couple of months.

Azwar said: "One must remain vigilant and maintaining interest rates is part of the vigilance. It's not the end of the tunnel yet as far as the recession is concerned."

High unemployment and low savings rates were still heavily affecting the consumer spending in the United States and Europe, said RAM Holding Bhd chief economist, Dr Yeah Kim.

He said: "Some of the stimulus packages are also expiring and coupled with weak consumer sentiment, the recovery of the global economy seems fragile." He continued that high deficits might lead to inflationary pressures.

According to United Overseas Bank Ltd economist, Ho Woei Chen, the present benchmark rate of 2% was conducive for growth and comfortable enough for businesses as indicated by the central bank.

She specified, "When inflation rate inches up and there are evidence of the economy rebounding, it will be timely to raise interest rates."