MAYBANK Investment Bank (Maybank IB) expects Bank Negara Malaysia (BNM) to lower the overnight policy rate (OPR) by 25 basis points at its upcoming Monetary Policy Committee (MPC) meeting on 9 July 2025.
In a note issued today, the investment bank acknowledged that while existing data do not yet demand an immediate cut, emerging signs of economic softening and external risks warrant a proactive adjustment.
“The dovish May MPC statement has opened the door for BNM easing. From a risk management perspective, we believe the risk of cutting too late clearly exceeds that of cutting too early,” it said.
Maybank IB added that despite no significant deterioration in economic indicators, the lag in policy transmission supports a forward-looking approach.
On the bond front, the bank observed that ringgit-denominated government bonds traded marginally stronger last week, with yields either flat or three basis points lower. ASEAN bonds, meanwhile, held their ground in spite of losses in UK gilts and US Treasuries following the release of non-farm payroll data.
“The curve has already fully priced in a cut, so market reaction will likely hinge on the tone—whether it is perceived as a neutral or dovish cut,” the bank noted. “Conversely, a decision to hold the rate may prompt a modest upward repricing in yields.” - July 7, 2025
