The Monetary Policy Committee (MPC) of Bank Negara Malaysia (BNM) has reduced the overnight policy rate (OPR) by 25 basis points to 2.75%. The ceiling and floor rates of the corridor of the OPR are thus reduced to 3.00% and 2.50% accordingly.
According to BNM, the adjustment to the OPR is a pre-emptive measure to secure the nation’s improving economic growth trajectory amid price stability. “At this current level of OPR, the MPC considers the stance of monetary policy to be appropriate in sustaining economic growth with price stability,” BNM said in a statement.
If you’re wondering what this cut in OPR means for you, the practical effect of lowered OPR rates include corresponding lower interest rates for both savings and loans. This is good news for those on a variable-rate loan like home loans, as well as those who want to take out a loan in the near future. However, the interest rates for savings products will also take a hit, so you will be earning less in interest for your savings accounts and new fixed deposits.
BNM last adjusted its OPR in May 2019 of last year, where it also reduced the OPR by 25 basis points – cutting the rate down to 3.00%.