Bank Negara Malaysia (BNM) on Wednesday announced a 25 basis points cut in the Overnight Policy Rate (OPR) to 2.75% from 3.00%, in an effort to support the economy facing a slowdown risk.
The level was the first time it has been touched since May 2023. According to a Bloomberg survey, half of 23 economists expected a rate cut while the rest predicted the rate to be maintained.
Their statement said the domestic economy remained strong, but global uncertainties could put pressure on the growth outlook. Therefore, this OPR cut is an initial step to ensure that growth remains stable in a moderate inflation environment.
However, for Malaysia, the latest data shows continued economic growth in the second quarter, driven by strong domestic demand and increasing exports.
Among the key factors supporting growth are a stable job market, income policy measures, continued investment and strategic initiatives under the national master plan.
BNM is confident that these factors will continue to support Malaysia's economic activity despite external challenges.
