Bank Negara Malaysia’s (BNM) Monetary Policy Committee (MPC ) decided to reduce the Overnight Policy Rate (OPR) by 25 basis points to 2.75 per cent.
The ceiling and floor rates of the OPR corridor were also reduced, to 3 percent and 2.5 percent, respectively.
According to the Monetary Policy Statement issued by BNM today, although the domestic economy is in a strong position, uncertainties surrounding external developments could affect Malaysia’s growth prospects.
“The OPR reduction is an initial step aimed at preserving Malaysia’s stable growth path, amidst a moderate inflation outlook.”
The MPC will continue to monitor current developments and assess the balance of risks that could affect the country’s growth and inflation projections. BNM also stated that the latest global indicators show that world economic growth continues to expand, supported by consumer spending, a healthy labour market, and supportive fiscal and monetary policies.
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BNM added that the country’s economic growth in the second quarter is expected to continue, driven by encouraging domestic demand and exports.
“Growth is expected to be supported by resilient domestic demand, as well as expansion of investment activities from multi-year public and private sector projects.”
Household spending is expected to remain strong with employment and wage growth, particularly in domestically oriented sectors, supported by income-related policy measures.
“Overall, inflation in 2025 is expected to remain moderate, given controlled global costs and the absence of excessive domestic demand pressures.”
You can refer to BNM’s full statement on its official website here.
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This post first appeared on WORLD OF BUZZ.
