Malaysia’s central bank retains interest rate at 3%

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Bank NegaraMalaysia’s central bank on November 7 decided to retain its policy interest rate in order to support economic growth and contain inflation pressures. The decision was in line with economists’ forecast.

The Monetary Policy Committee (MPC) of Bank Negara Malaysia kept its overnight policy rate unchanged at 3 per cent. The bank has been maintaining the rate at the current level since May 2011.

The MPC in its statement noted that that going forward, the country’s growth momentum will benefit from the expected improvement in the external sector.

The central bank expects inflation to move up further in the coming months, driven by domestic cost factors. Malaysia’ inflation accelerated to 2.6 per cent in September from 1.9 per cent in August, reflecting mainly the increase in petrol prices.

Nevertheless, the inflation outlook is forecast to be tempered by a stable external price environment, moderate domestic demand pressures and expansion in domestic capacity.

The bank said that domestic investment activity is set to continue during the rest of the year, led by private sector capital spending and infrastructure projects. Meanwhile, domestic demand is seen moderating, owing to the the public sector consolidation and moderation in private consumption.

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Malaysia's central bank on November 7 decided to retain its policy interest rate in order to support economic growth and contain inflation pressures. The decision was in line with economists' forecast. The Monetary Policy Committee (MPC) of Bank Negara Malaysia kept its overnight policy rate unchanged at 3 per cent. The bank has been maintaining the rate at the current level since May 2011. The MPC in its statement noted that that going forward, the country's growth momentum will benefit from the expected improvement in the external sector. The central bank expects inflation to move up further in the coming...

Reading Time: 1 minute

Bank NegaraMalaysia’s central bank on November 7 decided to retain its policy interest rate in order to support economic growth and contain inflation pressures. The decision was in line with economists’ forecast.

The Monetary Policy Committee (MPC) of Bank Negara Malaysia kept its overnight policy rate unchanged at 3 per cent. The bank has been maintaining the rate at the current level since May 2011.

The MPC in its statement noted that that going forward, the country’s growth momentum will benefit from the expected improvement in the external sector.

The central bank expects inflation to move up further in the coming months, driven by domestic cost factors. Malaysia’ inflation accelerated to 2.6 per cent in September from 1.9 per cent in August, reflecting mainly the increase in petrol prices.

Nevertheless, the inflation outlook is forecast to be tempered by a stable external price environment, moderate domestic demand pressures and expansion in domestic capacity.

The bank said that domestic investment activity is set to continue during the rest of the year, led by private sector capital spending and infrastructure projects. Meanwhile, domestic demand is seen moderating, owing to the the public sector consolidation and moderation in private consumption.

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