KUALA LUMPUR: Bank Negara Malaysia (BNM) has maintained the Overnight Policy Rate (OPR) at 3.25 per cent following the Monetary Policy Committee (MPC) meeting yesterday.
The central bank in a statement said at the OPR’s current level, the degree of monetary accommodativeness is consistent with 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,” it said.
BNM said the latest indicators showed the Malaysian economy would continue to expand, and going forward, the positive growth momentum is expected to be sustained, driven by the strength in both domestic and external demand, while private consumption will be supported by favourable income and labour market conditions.
Investment activity is projected to be sustained by implementation of ongoing infrastructure projects and capacity expansion by firms.
“On the external front, exports are expected to continue benefitting from the positive momentum in global growth and trade in advanced and regional economies. Overall, the prospects for the Malaysian economy remain strong.
“Headline inflation is expected to remain moderate for the year as a whole on expectations of a smaller effect from global cost factors. A stronger ringgit exchange rate compared to 2017 will mitigate import costs,” it said.
However, BNM said 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 projected to remain moderate amid stable demand conditions.
“Malaysia’s economic fundamentals are strongly anchored. The domestic economic outlook remains positive, the financial sector is strong and monetary and financial conditions are supportive of economic growth in the post-election environment,” BNM added. — Bernama