Heading into Bank Negara Malaysia's (BNM) policy decision on Thursday, the central bank is expected to keep the overnight policy rate (OPR) unchanged at 3.00%.
A Reuters poll sees interest rates not only unchanged, but on hold until the end of the year.
Although headline inflation fell to a one-year low in May to 2.8%, core inflation was still seen as high, moderating to 3.5%.
This indirectly suggests that the central bank will keep its OPR at its current level for longer.
22 out of 25 economists surveyed expect BNM to keep the OPR at 3.00% following the surprise hike in May.
While 3 other economists predict that the central bank will implement another increase of 25 basis points to 3.25%.
Analysts said that BNM's surprise hike in May was a sign that the tightening cycle was over.
Slower growth and subdued inflation are seen as supporting the central bank to keep rates on hold until the end of the year.
However, no cuts are expected to occur this year due to the weakness of the currency and high inflation due to expensive imports restraining BNM from doing so.
