BNM Maintains 3% Interest Rate Amidst Global Economic Challenges

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Bank Negara Malaysia

“BNM maintains 3% OPR, supporting growth amid global challenges. Explore insights on inflation, risks, and policy impacts in this update.”

KUALA LUMPUR, 24th Jan 2024 – The overnight policy rate (OPR), Malaysia’s headline interest rate, remains unchanged at 3%, as announced by Bank Negara Malaysia (BNM) following the Monetary Policy Committee (MPC) meeting on Wednesday. This marks the fourth consecutive maintenance of the OPR at 3% since July 2023, after a 25 basis points increase in May of that year. 

BNM stated that, at the current OPR level, the monetary policy remains supportive of the economy and aligns with the current assessment of inflation and growth prospects. While acknowledging global monetary policy tightening, BNM highlighted a recent decrease in global headline and core inflation. 

In Malaysia, economic growth is anticipated to improve in 2024, driven by export recovery, resilient domestic expenditure, employment, and wage growth. The central bank outlined potential risks, such as weaker external demand and commodity production declines, as well as upside factors like spillover from the tech sector and enhanced tourism activity. 

BNM emphasized the importance of ongoing global trade challenges and identified factors influencing the inflation outlook, including domestic policy changes on subsidies and price controls, global commodity prices, and financial market developments. The government’s planned review of price controls and subsidies in 2024 is expected to impact inflation and demand conditions.

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