KUALA LUMPUR: Bank Negara Malaysia (BNM) is expected to raise its overnight policy rate (OPR) by 25 basis points to 2.5% this week, its third consecutive rate hike, says Moody’s Analytics.
This is aimed at helping ease the country’s inflation coupled with a robust economic rebound.
In a statement, Moody’s said Malaysia’s headline consumer price index rose by 4.4% year-on-year in July, a full percentage point increase from the previous month.
“Meanwhile, Malaysia’s second-quarter gross domestic product came in far above expectations, driven by an uptick in demand for services after borders fully reopened in April,” it said.
Moody’s said that on the external front, raising the OPR will shore up the ringgit, which has been slipping against the greenback amid aggressive rate hikes by the US Federal Reserve.
BNM’s September monetary policy committee is scheduled to meet on Sept 7 and 8.