Kuala Lumpur: Bank Negara Malaysia (BNM) Governor Datuk Seri Abdul Rasheed Ghaffour has announced that the Monetary Policy Committee (MPC) has decided to maintain the Overnight Policy Rate (OPR) at 3.0 percent. This decision aligns with the central bank’s evaluation of Malaysia’s economic prospects, which show signs of robust growth and stable inflation.

According to BERNAMA News Agency, the MPC’s decision to keep the OPR unchanged reflects its commitment to price stability, which supports sustainable economic growth. The evaluation focuses on the trajectory of Malaysia’s economic growth and inflation over the next one to two years. Despite challenges in the global economy, Malaysia’s economy expanded by 5.1 percent in 2024, with strong domestic spending expected to drive future growth. Key factors include positive labor market conditions and policy measures such as salary increases for civil servants and a higher minimum wage implemented earlier this year.

Investment activities, particularly in sectors like electrical and electronics, automotive, food and beverage, and real estate, are enhancing Malaysia’s productive capacity. This expansion is expected to meet future demand without triggering excessive price pressures. Although exports may grow at a moderate pace due to global uncertainties, they will be supported by the global technology upcycle, non-E and E sector growth, and increased tourist spending, driven by global travel demand and improved flight connectivity.

Inflation is projected to remain manageable in 2025, with demand pressures staying moderate. Global cost conditions are easing, thanks to lower energy, food, and agricultural commodity prices. Malaysia’s domestic policy reforms, including the Sales and Services Tax (SST) expansion and RON95 subsidy rationalization, are anticipated to have a contained impact on inflation, primarily affecting nonessential products.

Addressing concerns about external trade uncertainties, particularly with President Trump’s second term, the governor emphasized Malaysia’s resilience. The country’s diversified economy and broad export base are expected to mitigate external shocks. Malaysia’s services sector and diversified export structure play crucial roles in cushioning against global trade challenges. The government remains active in facilitating key investments and strengthening industrial capabilities to support the economy.

Governor Abdul Rasheed highlighted the importance of regional integration and trade with ASEAN countries, which continue to be key trading partners for Malaysia. Ongoing structural reforms and initiatives to encourage trade flows are set to provide further support to the Malaysian ringgit and help the country navigate market volatility.

For more insights into BNM’s economic assessments and projections, the governor encouraged stakeholders to review the forthcoming Annual Report and Economic and Monetary Review, scheduled for publication on March 24.