KUALA LUMPUR, Nov 6 — Bank Negara Malaysia’s (BNM) decision to maintain the Overnight Policy Rate (OPR) at 2.75 per cent reflects its assessment that the rate remains consistent with price stability outlook and sustainable economic growth, said Governor Datuk Seri Abdul Rasheed Ghaffour.

“When we assess the growth and inflation outlook, we see that the current OPR level of 2.75 per cent remains consistent with our assessment of the economic outlook,” he told Bernama after the OPR announcement yesterday.

Abdul Rasheed said global growth demonstrated resilience, supported by factors such as the continued expansion of technology-related investments and strong demand associated with the adoption of artificial intelligence (AI) technologies.

He said Malaysia’s economy demonstrated resilience in sustaining growth, with the third-quarter (3Q) advance estimate recording a 5.3 per cent expansion and average growth for the first three quarters reaching 5.6 per cent.

He said domestic demand remained supported by sustained household spending, ongoing structural reforms and investment activities, while exports continued to benefit from strong demand for electrical and electronics (E&E) products, supported by the global AI and technology upcycle.

Against this backdrop, the governor said the central bank saw no immediate need to tighten policy as inflation remains contained.

Nevertheless, the MPC is vigilant about signs of broader price pressures and has the flexibility to adjust policy when needed.

BNM is also monitoring wage increases because stronger household purchasing power could potentially generate additional demand and put pressure on prices.

“If we see pressure on prices as wages increase, thus changing the inflation trajectory, an adjustment may be necessary to ensure monetary policy remains consistent with the growth and inflation outlook,” he said.

Abdul Rasheed said Malaysia’s economic growth is expected to exceed five per cent this year while the outlook for 2027 remains positive, supported by resilient domestic demand, ongoing investment activities and sustained external demand, particularly for technology-related products.

He added that while the 2027 growth trajectory remains strong, some moderation would be expected.

“Domestic demand is expected to remain supported by improving household incomes, continued structural reforms and measures under Budget 2027,” he said, adding that the global AI and technology upcycle, as well as demand for data centres, would remain important growth drivers next year.

He emphasised that Malaysia’s diversified economy and solid buffers will also help the country weather global uncertainties.

Investments from previous years are being realised, further supporting growth and new investments are also expected to have a higher multiplier impact on the economy.

Nonetheless, inflation is expected to edge higher next year — between 1.8 and 2.8 per cent — compared with 1.5 to 2.5 per cent this year amid global inflation as input prices remain elevated. — Bernama