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BANK Negara Malaysia (BNM) has decided to keep the Overnight Policy Rate (OPR) unchanged at 2.75 per cent in its final Monetary Policy Committee (MPC) meeting for 2025, citing the stance as appropriate to support the economy while maintaining price stability.
In a statement today, the central bank said the current OPR level is deemed sufficient to provide economic support in a stable price environment.
"MPC will continue to monitor ongoing developments and assess the balance of risks surrounding domestic growth and inflation prospects," it said.
BNM noted that resilient domestic demand is expected to continue supporting growth into 2026. Labour utilisation, wage growth, and income-related policy measures will remain key drivers of household spending. Investment expansion is projected to benefit from multi-year projects in both the private and public sectors, continued implementation of approved investments, and catalyst initiatives under national master plans and the Thirteenth Malaysia Plan (RMK13).
"Measures under Budget 2026 will also provide support to growth. These growth prospects remain subject to uncertainties, particularly in relation to global developments. Downside risks to growth stem from global trade slowdowns, weaker sentiment, and output shortfalls in commodity production," the bank added.
The central bank further highlighted that recent indicators show continued developments in global growth.
"While higher tariffs will continue to affect global growth, prospects remain supported by resilient labour markets, easing inflation, less restrictive monetary policies, and supportive fiscal policies. Resolution of more trade negotiations has somewhat reduced global uncertainty," BNM said, cautioning that growth could slow due to higher tariffs and escalating geopolitical tensions.
BNM also flagged concerns over persistently high valuations in financial markets, though growth could accelerate moderately if tariff impacts remain limited and supportive policies in advanced economies continue.
Domestic inflation is projected to remain moderate in 2026 as global cost pressures ease. Year-to-date, headline and core inflation averaged 1.4 per cent and 1.9 per cent, respectively.
"Global commodity prices are expected to remain moderate, contributing to contained domestic costs. Core inflation in 2026 is projected to remain stable and near its long-term average, reflecting ongoing economic activity expansion without excessive demand pressures. In this environment, the overall impact of domestic policy reforms on inflation in 2026 is expected to be limited," the statement concluded. - November 6, 2025