KUALA LUMPUR, May 16 – Bank Negara Malaysia’s (BNM) Monetary Policy Committee (MPC) announced an overnight policy rate (OPR) increase of 25 decimal points to 3 percent. In a statement, the central bank stated that this increase will cause the OPR ceiling and floor rates to increase to 3.25 percent and 2.75 percent respectively. This makes the current OPR rate return to the pre-Covid-19 pandemic rate on 7 May 2019.
BNM also informed that most central banks maintain strict financial policies. Given the domestic growth prospects that continue to be resilient, the MPC assesses that now is the right time to continue to return the level of monetary accommodation to an appropriate level. Following this decision, the MPC has ended the monetary stimulus aimed at dealing with the Covid-19 crisis to promote economic recovery,” the statement quoted.
Commenting further, BNM informed that the MPC also recognized the need for an appropriate monetary policy stance to avoid the risk of financial imbalances in the future following the continued strength of the Malaysian economy. At the current OPR level, according to BNM, the stance of monetary policy remains quite accommodative and continues to support economic growth.
