Bank Negara has
announced that the Monetary Policy Committee (MPC) has decided that it will
maintain the overnight policy rate (OPR) at 3%.
In a statement
issued by Bank Negara, it said that the MPC considers the current stance of
monetary policy to be accommodative and supportive of the economy.
Additionally, the committee will continue to assess the global economic and
financial developments, including its implications on the overall outlook for
inflation and growth of the Malaysian economy.
As the global
economy is expected to continue experiencing slow growth, the growth prospects
of advanced economies remains uncertain. Despite the
weaker external demand, Bank Negara said in a statement that growth in the
regional economies would remain supported by domestic demand.
In the local
economy, the sustained expansion in domestic activity has offset the weaknesses
in the external sector. Moving forward, Bank Negara believes that income growth
and stable employment conditions will support private consumption.
“Investment is expected to remain firm, led by increased capital spending in
the domestic-oriented sectors, the oil and gas sector and the on-going
implementation of infrastructure projects,” the central bank said.
Bank Negara
expects headline inflation is to remain moderate for the remainder of the year.
“While inflation may increase in 2013, it is expected to remain modest given
the excess capacity in the economy. Global energy and commodity prices are also
likely to be contained given the weak global conditions. Upside risks to
inflation could, however, emerge in the event of supply disruptions that
results in higher global prices for commodities,” it added.