At its previous policy review in July, the central bank had lowered its rate from 3%.

BNM said in a statement that the current OPR level remains appropriate and supportive of the economy amid price stability.

It said the latest indicators point towards “continued expansion in global growth, supported by sustained consumer spending and front-loading activities”.

“The global growth outlook will remain supported by positive labour market conditions, a less restrictive monetary policy and fiscal stimulus.

“Nonetheless, trade policy developments are still expected to weigh on global growth going forward as the announced tariff rates take effect and the front-loading activity dissipates,” BNM said.

The central bank said Malaysia’s economy is on track to expand between 4% and 4.8% this year, with growth expected to continue into 2026 on the back of strong domestic demand, steady wages and ongoing investment projects.

It also said headline and core inflation averaged 1.4% and 1.9% respectively in the first seven months of 2025, with both expected to moderate over the next two years, helped by easing global commodity prices.

“The overall impact of the announced and upcoming domestic policy reforms on inflation is expected to be contained,” it added.

The central bank also said the risks to global growth remain mixed, saying that while tariffs and geopolitical tensions could weigh on the outlook, “favourable outcomes from remaining US trade negotiations and pro-growth policies in major economies” could boost Malaysia’s export and growth prospects.

“The MPC will continue to monitor ongoing developments and assess the balance of risks surrounding the outlook for domestic growth and inflation.”