BNM Keeps OPR At 2.75% As Inflation Remains Moderate

Samuel Chua

5th March 2026 - 3 min read

Bank Negara Malaysia (BNM) has kept the Overnight Policy Rate (OPR) unchanged at 2.75%, indicating that borrowing conditions are expected to remain steady for now. The decision was announced following the latest Monetary Policy Committee (MPC) meeting on 5 March 2026.

The central bank said the current rate level remains appropriate to support economic growth while maintaining price stability. For households and businesses, this means interest rates on most loans and financing facilities are unlikely to shift significantly in the near term.

Borrowing Costs Expected To Stay Unchanged

The OPR serves as a key benchmark that influences the base lending and financing rates used by banks when pricing loans. When the policy rate remains unchanged, borrowing costs for products such as housing loans, personal financing, and business loans typically move in the same direction.

As a result, borrowers with variable-rate loans are unlikely to see immediate changes to their monthly repayments following the latest decision. Deposit rates offered by banks are also expected to remain similar unless financial institutions independently adjust their pricing.

Domestic Growth Continues To Support The Economy

BNM noted that Malaysia’s economy expanded by 5.2% in 2025, driven by strong domestic demand, higher electrical and electronics exports, and increased tourism activity. The central bank expects growth momentum to continue in 2026, anchored mainly by resilient household spending.

Employment conditions, wage growth, and policy measures are expected to continue supporting consumption. Investment activity is also projected to remain firm as multi-year projects progress in both the public and private sectors, alongside the rollout of smaller public initiatives and the continued realisation of previously approved investments.

Malaysia’s external sector may also benefit from sustained demand for electrical and electronics exports as well as higher tourist arrivals.

Inflation Expected To Remain Manageable

Inflation levels remain relatively moderate. Headline inflation stood at 1.6% in January 2026, while core inflation was recorded at 2.3%.

BNM expects overall inflation this year to remain contained despite possible volatility in global commodity prices. Core inflation is projected to stay close to its long-term average, reflecting steady economic activity without signs of excessive demand pressure.

External Risks Continue To Be Monitored

While domestic conditions remain supportive, the central bank highlighted several external risks that could influence the outlook. These include uncertainties linked to the ongoing conflict in the Middle East, which may affect global financial markets and trade flows depending on how the situation evolves.

Additional risks include potential tariff increases and heightened volatility in global financial markets. Despite these uncertainties, BNM said Malaysia is entering this period from a position of relative strength, supported by resilient domestic demand, moderate inflation, a sound financial sector, and a stable external position.

Policy Stance Remains Supportive

At the current level, BNM considers the monetary policy stance appropriate for sustaining economic activity while maintaining price stability. The MPC said it will continue to monitor developments in both the global and domestic economy before assessing the balance of risks to Malaysia’s growth and inflation outlook.

For now, keeping the OPR unchanged signals that borrowing conditions in Malaysia are expected to remain steady in the near term.

Samuel Chua

Samuel writes about personal finance and financial news, focusing on how banking updates, policies, and promotions affect everyday money decisions. He enjoys making complicated financial topics easier to follow. Outside of writing, he spends his time watching TV shows and occasionally convincing himself he will only watch one episode.

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