By NG MIN SHEN/FILE PIX
Bank Negara Malaysia (BNM) has maintained the Overnight Policy Rate (OPR) at 3.25%, as inflation remains manageable while a stronger local note is expected to offset import costs.
The Monetary Policy Committee (MPC) made the decision at today’s meeting. The central bank raised raised the OPR for the first time since 2014 by 25 basis points (bps) on January 25 this year.
“At the current level of the OPR, the degree of monetary accommodativeness is consistent with the policy stance to ensure the domestic economy continues on a steady growth path amid lower inflation.
“The MPC will continue to monitor and assess the balance of risks surrounding the outlook for domestic growth and inflation,” the central bank said in a statement today.
It said inflation is projected to average lower in 2018, on expectations of a smaller effect from global cost factors.
A stronger ringgit exchange rate compared to 2017 will mitigate import costs, it added.
Global energy and commodity prices are expected to trend higher in 2018, albeit at a more moderate pace relative to the previous year.
“However, the trajectory of headline inflation will be dependent on future global oil prices which remain highly uncertain. Underlying inflation, as measured by core inflation, is also projected to moderate due to improving labour productivity and ongoing investments for capacity expansion,” BNM stated.