Indonesia’s vaccine strategy, rate cut likely in Malaysia

Indonesia’s vaccination campaign got underway earlier this week amid surging cases of COVID-19 across the country. Whereas most countries are prioritising the elderly and vulnerable in vaccination rollouts, Indonesia has said it will begin by inoculating the working age population first, in the hope that this will provide more of a boost to the struggling economy. Even so, the challenges facing the vaccine rollout mean social distancing restrictions will remain a drag on the economy for some time to come. The worsening outlook in Malaysia, where the government has imposed a two-week lockdown to slow the rise in virus cases, means the central bank is likely to cut interest rates at its scheduled meeting on Wednesday. We have pencilled in a 50bp rate cut.