Redistributive policy

Bank Negara set to raise interest rate again, Moody’s says

At its third MPC meeting in May, the central bank raised the OPR by 25 basis points to 2.00%. — Photo by Yusof Mat Isa

Monday, July 04, 2022 12:07 PM MYT

KUALA LUMPUR, July 4 – Bank Negara Malaysia (BNM) is expected to raise its overnight rate (OPR) by 25 basis points (bps) to 2.25% at its fourth monetary policy meeting (MPC) of the month. expected this week, according to Moody’s Analytics.

In its report today, the research firm also noted that the country’s central bank raised the rate in May, lifting it from the record low it had languished in nearly two years.

The two-day MPC meeting of the BNM is due to start tomorrow.

Meanwhile, MIDF Research said BNM would “consider a further 25 basis point rate hike” following the continued rise in core inflation, reflecting strong underlying domestic demand.

“Furthermore, the optimistic momentum of distributive trade sales, the drop in the unemployment rate to a new pandemic low of 3.9% in April 2022 and the double-digit expansion rate of foreign trade provide positive signals for a strong recovery in the economy,” he added in a statement. note today.

At its third MPC meeting in May, the central bank raised the OPR by 25 basis points to 2.00%. The ceiling and floor rates of the OPR corridor are increased accordingly to 2.25% and 1.75%, respectively.

He said the sustained reopening of the global economy and improving labor market conditions continued to support the recovery in economic activity. — Bernama