Guan Eng: Don’t raise OPR for rest of year

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DAP has welcomed the decision by Bank Negara Malaysia (BNM) to maintain its overnight policy rate (OPR) at 2.75 percent yesterday.

“This is welcome news to Malaysia’s economy in the face of an expected slowdown in global growth and moderation of inflationary pressures, both locally and internationally,” DAP national chairman Lim Guan Eng said.

Lim, who is Bagan member of parliament, said economic growth in Malaysia would soften from 8.7 percent last year to 4.5 percent this year, whilst inflation was expected to average between 2.8 to 3.8 percent this year compared with 3.3 percent last year.

He said Malaysia’s consumer price index (CPI) in January this year rose 3.7 percent from a year earlier, versus 3.8 percent in December 2022.

“There is therefore no urgency by BNM to increase the OPR, as done last year, when BNM increased OPR by a total of 100 basis points from a historic low of 1.75 percent as it sought to tame inflation amid robust growth.

“In January this year, BNM surprised many by not increasing the OPR, easing the cost burden of higher interest rates on individual and SMEs borrowers.

Sayuti Zainudin

“With BNM not increasing OPR again this month, DAP hopes that BNM can demonstrate its heart for the B40 and M40 groups, and SMEs by not increasing OPR for the rest of the year,” he added.

It was reported yesterday that BNM kept the OPR unchanged at 2.75 percent as it did in January.

This was despite having to grapple with the implications of a likely 50-bps hike in US interest rates, thanks to the Federal Reserve chair Jerome Powell’s hawkish comments to the US Congress on Tuesday. –  NST