In a surprising move, Bank Negara (BNM) announced that it will keep the overnight OPR at 2.75% following a meeting of its monetary policy committee (MPC) on January 19, 2023. This it’s the opposite of what most analysts predicted. , which is an increase in OPR of 0.25% in January, followed by another increase of 0.25% in March.
At the beginning of 2022, the OPR was at 1.75% and it stayed that way after the MPC met on March 3. The first of the hourly OPR increases, each by 0.25%, was on May 11, followed by increases on July 6. , September 8th Y November 3.
Referring to BNM data, the OPR reached its highest point at 3.5% from April 26, 2006 to October 24, 2008. Meanwhile, the OPR reached its lowest point at 1.75% from July 7, 2020 to March 3, 2022 as the country battled the covid-19 pandemic.
The OPR has an impact on auto loans, which can make installment purchase loans more expensive. The Malaysian Automotive Association (MAA) has said that expect car sales to fall this year after a record 2022, with the OPR weakening consumer confidence and their ability to get auto loans
According to BNM launching, the latest data indicates that Malaysia experienced continued economic expansion in the last quarter of last year due to resilient domestic demand. As a result, growth for 2022 is expected to exceed the previously projected range of 6.5-7.0%, although this is expected to moderate amid a slower global economy.
The central bank also noted that headline inflation averaged 3.4% for the January-November 2022 period. As projected, headline inflation peaked in Q3 2022, while core inflation, as measured by inflation core, averaged 2.9% through November 2022.
This year, headline and core inflation are expected to moderate but remain elevated on persistent demand and cost pressures. Existing price controls and fuel subsidies, along with remaining spare capacity in the economy, will continue to partly contain the extent of upward pressures on inflation, he added.
