Kuala lumpur: Bank Negara Malaysia's (BNM) decision to maintain the Overnight Policy Rate (OPR) at 2.75 percent today underscores its confidence in the Malaysian economy's ability to sustain healthy growth into 2026, according to economists.

According to BERNAMA News Agency, Bank Muamalat Malaysia Bhd's chief economist, Dr. Mohd Afzanizam Abdul Rashid, noted that the Monetary Policy Committee's (MPC) decision aligns with expectations from most economists. He stated that the MPC's tone remains balanced and positive macroeconomic conditions are anticipated to persist through the remainder of the year. "Hence, we believe the OPR is likely to be maintained at 2.75 percent in the next MPC meeting in November," he commented.

Meanwhile, TA Securities Research economist, Shazma Juliana Abu Bakar, remarked that BNM's decision reflects its assessment that the current monetary policy stance continues to support price stability and sustainable growth. She highlighted that looking forward, markets perceive a tilt towards a 25 basis points hike in 2027, especially if significant central banks resume monetary tightening.

Shazma further explained that a modest increase in the OPR is unlikely to significantly impact private consumption, as household spending is expected to be bolstered by steady wage growth, a resilient labor market, and targeted government assistance. However, she cautioned that higher borrowing costs could impact interest-sensitive spending, particularly in housing and large-scale purchases. "The timing of any adjustment will remain data-dependent, particularly on the pace of US rate hikes and domestic inflation," she added, noting that inflation is projected to remain manageable at 2.1 percent in 2026 and 1.7 percent in 2027.

BNM has held the OPR steady at 2.75 percent for the seventh consecutive Monetary Policy Committee meeting since a 25 basis points cut in July 2025. The central bank indicated that the latest indicators suggest resilient global growth, supported by robust global tech expansion, improving supply conditions, and stable labor markets. It also mentioned that although inflation has slightly decreased in recent months, it is expected to remain elevated due to the delayed pass-through of energy costs to consumer prices.

BNM added that while uncertainties surrounding the West Asia conflict could continue to impact global growth amid ongoing inflationary pressures, sustained tech-related spending is anticipated to cushion these effects.