Its governor, Shamsiah Yunus said at the BNM Sasana Symposium 2023 today that OPR is by design “a blunt tool to deliver price stability”.

“We recognise that although the overall economy is in good health, there are some who are still facing economic challenges.

“More targeted measures are in place to help those who may be facing difficulties in meeting their monthly loan repayments.

“Help continues to be available through banks or the AKPK (Credit Counselling and Debt Management Agency), which can work out new repayment arrangements tailored to individual circumstances,” she said.

Shamsiah reiterated that hiking the OPR was necessary to rein in inflation by acting sooner rather than later.

BNM had raised the OPR by 25 basis points (bps) to 3% following its monetary policy committee (MPC) meeting on May 3.

Before that, the central bank had kept the OPR unchanged at its January and March MPC meetings, after raising it by 100 bps between May and November last year.

The consistent OPR hikes last year followed surging inflation, contributed by the Covid-19 pandemic and the Russia-Ukraine conflict.

“Keeping (interest) rates too low for too long can have damaging effects on the economy,” Shamsiah said.