Malaysian Central Bank Keeps OPR Unchanged For Second Straight Meeting

Bank Negara Malaysia left the Overnight Policy Rate unchanged at 2.75% for the second consecutive meeting, as expected by 11 out of 20 economists polled by Bloomberg.

• The central bank said that although "there were some positive developments" in the global economy, it continues to be "weighed down by elevated cost pressures and higher interest rates." Against the backdrop of a slower global economy, the BNM expects domestic economy to moderate in 2023.
• The statement noted that "the implementation of projects from the recently re-tabled Budget 2023 would provide upside risks to the domestic growth outlook," while "downside risks continue to stem mainly from global developments."
• "Headline and core inflation are expected to moderate over the course of 2023, but will continue to be elevated amid lingering demand and cost factors." In addition, "the balance of risk to the inflation outlook is tilted to the upside" and depends on domestic price controls and global commodity prices.
• "At the current OPR level, the stance of monetary policy remains accommodative and supportive of economic growth. The MPC will continue to assess the impact of the cumulative OPR adjustments, given the lag effects of monetary policy on the economy."
• Click here to see the full statement.