KUALA LUMPUR – The Malaysian economy has been absorbing the impact of the overnight policy rate (OPR) hike quite well, and “it is very clear that we are no longer in a crisis”, said Bank Negara Malaysia (BNM) governor Tan Sri Nor Shamsiah Mohd Yunus today.
“The momentum, in terms of the repayment of loans, has not been impacted,” she said in reference to the OPR hikes during a joint press conference by BNM and the Statistics Department on Malaysia’s second quarter (Q2) 2022 gross domestic product performance here today.
The central bank increased the OPR by 50 basis points in two consecutive meetings in May and July.
“The OPR was first increased in May (as) it was deemed that the large support needed during the pandemic was no longer warranted.
“This has remained unchanged as the economy continues on the recovery path with the growth of 6.9% in the first half of the year.
“It is very clear that we are no longer in a crisis. Growth continues to be supported by firm domestic demand amid better labour conditions, recovery in tourism activity, and improved investment activities and prospects,” Nor Shamsiah said.
She noted that the recent OPR adjustments would also preemptively manage the risk of excessive demand on price pressures.
“It is important to remember that we are coming from a historically low OPR level. This means that despite the OPR adjustments, monetary policy would remain accommodative this year to support the economic recovery,” said Nor Shamsiah.
She reiterated that the central bank is committed to adjusting the monetary policy in a gradual manner as the country is on a recovery path. – Bernama, August 12, 2022
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