The OPR was last revised in July 2014 to 3.25 per cent from 3.00 per cent.

The Monetary Policy Committee (MPC) will continue to carefully assess external and domestic developments and their implications on the risks  to inflation and the Malaysian economy, it said.

“While the risks of destabilising financial imbalances are contained, the MPC will continue to monitor these risks to ensure the sustainability of overall growth prospects,” it said in a statement issued after today’s monetary policy committee meeting.

The central bank said headline inflation averaged 0.7 per cent in the first quarter of 2015 due to lower domestic fuel prices. For the rest of the year, headline inflation was expected to trend higher given the impact of the implementation of the Goods and Services Tax.

This is expected to be partially offset by the overall lower global commodity and energy prices.

“Underlying inflation is expected to be contained amid the stable domestic demand conditions,” it said. ― Bernama