The continued monetary policy stance is unlike other countries in the region, which have started to cut rates in recent weeks, noted London-based economic research firm Capital Economics.
BNM on Thursday announced that the overnight policy rate (OPR) will remain at 3% following the Monetary Policy Committee’s two-day meeting, which aligns with expectations from economists surveyed by Bloomberg.
“At the current OPR level, the monetary policy stance remains supportive of the economy, and is consistent with the current assessment of inflation and growth prospects,” BNM said.
“Going forward, exports are expected to be further lifted by the global tech upcycle given Malaysia’s position in the semiconductor supply chain, as well as continued strength in non-electrical and electronics goods.
Malaysia’s economy may expand 4%-5% this year, according to government forecast, following a weaker-than-expected 3.
A Bloomberg poll showed that all 24 economists it surveyed are expecting BNM to keep the OPR unchanged at 3% following March's milder-than-expected inflation data — up 1.
Bank Negara Malaysia resisted pressures to raise the overnight policy rate last November, and “we expect the same this week”, HSBC said.
A vast majority of Malaysian households, about 7 million of them (88.
MIDF Research said from a medium-term perspective, policy rate normalisation is needed to avert risks that could destabilise the future economic outlook such as persistently high inflation and a further rise in household indebtedness.
This is the fourth time that the MPC has decided to maintain the OPR at 3% since July 2023.
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