3rd September 2026 - 3 min read
Bank Negara Malaysia has kept the Overnight Policy Rate unchanged at 2.75% following the Monetary Policy Committee’s meeting on 3 September 2026. The central bank also lifted its expectation for the year, saying the economy is now on track to expand by around 5% rather than somewhere inside the 4% to 5% range it projected in July.
The rate has held at 2.75% since BNM lowered it from 3.00% in July 2025, its first cut in five years.
The OPR is the benchmark banks use to set their base lending and financing rates, which determine what you pay on a floating-rate home loan, personal loan or hire purchase agreement priced against it. With the rate held, monthly repayments on variable-rate borrowing should stay where they are until at least the next MPC meeting.
Fixed deposit and savings account rates follow the OPR, so returns should hold steady unless individual banks adjust their own pricing to compete for deposits.
The economy expanded by 5.7% in the first half of 2026, a pace BNM called strong given global conditions over that period. Exports came in stronger than expected, with domestic demand holding steady.
BNM expects the full year to come in at around 5% growth, and the economy to stay resilient into 2027. Demand for electrical and electronics goods should continue lifting the external sector, helped by tech-related non-E&E exports and sustained tourist spending, while stable employment and ongoing investment activity support spending at home.
Headline inflation averaged 1.8% over the first seven months of 2026, with core inflation at 2%. BNM said domestic policy measures and stable demand conditions kept elevated costs from reaching consumers, helped by limited spillover from export strength into wages.
Global commodity prices tied to the Middle East conflict are still pushing up cost conditions. The MPC said it will keep monitoring cost pressures and domestic demand conditions, given how both affect inflation.
BNM named prolonged geopolitical tension, tighter global financial conditions and concerns over valuations in financial markets as the main downside risks to global growth. For Malaysia, the risks are a drawn-out conflict and lower commodity production.
Growth could come in higher than expected if technology spending strengthens, supply chain conditions recover faster or major economies introduce pro-growth policy measures, the central bank said.
At 2.75%, the MPC considers the stance consistent with continued price stability and sustainable economic growth. That wording matches July’s statement, which also described the stance as consistent rather than supportive.
The committee said it will remain vigilant to ongoing developments and assess the balance of risks to domestic inflation and growth. The next decision is due on 5 November, the final MPC meeting of 2026.
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As a creative content writer, Eloise has covered finance, business, lifestyle topics, and even moonlights as a singer-songwriter outside of RinggitPlus. Her current interests are learning the best ways to optimise spending and credit card hacks to gain more airline miles.
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