Thursday, 01 Oct 2020 07:41 PM MYT
The revision in outlook was made after factoring in the assumption of mass Covid-19 vaccine deployment in the second half of next year, the investment bank said. “The government’s 2021 Budget is likely to remain large, to accommodate the ongoing restrictions, until a vaccine is widely available, and this would be aided by the already-low interest rate environment,” it said.
“There is also a possibility that the government’s social assistance for the low-income group will be expanded, in line with the revision of the poverty line income from RM980 to RM2,208 to benefit a larger portion of the population,” it said. On the fiscal deficit, RHBIB said it expected the deficit to narrow to five per cent of the gross domestic product in 2021 from 6.5 per cent deficit projected for this year, contributed by a lower expenditure — albeit remaining large relative to the levels seen before the pandemic — and rising revenue collection.