Bank Negara Malaysia has decided to maintain the Overnight Policy Rate at 2.75% following its Monetary Policy Committee meeting on 22 January 2026. The decision keeps borrowing costs unchanged, providing stability for households and businesses managing loans and financing plans.

The central bank said the current monetary policy stance remains appropriate, supporting economic growth while maintaining price stability.

Global Growth Outlook Remains Resilient Despite Uncertainties

Global economic growth in 2025 turned out stronger than expected, supported by lower-than-anticipated tariffs, increased technology spending linked to artificial intelligence, and stronger fiscal support. For 2026, global growth is expected to remain resilient, although the impact of tariffs could weigh on economic activity.

Downside risks include the possibility of higher tariffs, escalating geopolitical tensions, and increased volatility in global financial markets. At the same time, stronger technology investment and pro-growth policies in major economies could provide upside support.

Domestic Growth Supported By Demand, Jobs, And Investment

Malaysia’s economic growth in 2025 is expected to come in at the upper end of the forecast range, with growth momentum projected to continue into 2026. This outlook is supported by resilient domestic demand, underpinned by employment conditions, wage growth, and income-related policy measures that continue to support household spending.

Investment activity is expected to remain firm, driven by progress in multi-year projects across both the private and public sectors, alongside the rollout of new smaller-scale public initiatives and national development plans.

External Sector Benefits From E&E Exports And Tourism

The external sector is expected to continue contributing to growth, supported by sustained demand for electrical and electronics exports and higher tourist spending. These factors are expected to help offset external uncertainties linked to global trade conditions.

However, slower global trade and lower-than-expected commodity production could weigh on the outlook, while stronger demand for E&E products and more robust tourism activity could lift growth further.

Inflation Expected To Remain Moderate In 2026

Headline inflation averaged 1.4% in 2025, while core inflation averaged 2.0%. For 2026, headline inflation is expected to remain moderate amid easing global cost pressures and modest commodity prices.

Core inflation is projected to stay stable and close to its long-term average, reflecting continued economic expansion without excessive demand pressures. This inflation outlook supports the decision to keep the policy rate unchanged.

What The OPR Decision Means For Consumers

With the OPR maintained at 2.75%, interest rates on home loans, car loans, and personal financing are expected to remain stable in the near term. This provides greater certainty for households planning major purchases or managing existing debt.

Bank Negara said it will continue to monitor domestic and global developments closely and assess the balance of risks to growth and inflation, signalling that future policy decisions will remain data-driven.

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