Juwai IQI Expects BNM To Maintain OPR

KUALA LUMPUR, Nov 3 (Bernama) -- Bank Negara Malaysia (BNM) is expected to leave the overnight policy rate (OPR) at 2.75 per cent at November’s Monetary Policy Committee (MPC) meeting this Thursday, said Juwai IQI. 

However, the central bank is likely to raise the rate by 25 basis points to 3.00 per cent in the first quarter of 2027, said its co-founder and group chief executive officer Kashif Ansari.

He said economic growth has been stronger than expected since the last MPC meeting, and fortunately, inflation has been lower. 

“BNM Governor Datuk Seri Abdul Rasheed Ghaffour opened the door to a potential increase in rates earlier this month. He said the central bank now has more leeway to lift rates if price pressures rise.

“He also said the current rate is about where it should be given the levels of inflation and growth he sees,” Kashif said in a statement. 

He added gross domestic product (GDP) would likely climb by around 5.0 per cent this year, and the government expects it to range from 4.2 per cent to 5.2 per cent next year. 

Meanwhile, inflation could be higher in 2027 as the government expects costs for energy, food, and economic inputs to increase early in the year.

“That’s why the forecasts for inflation next year suggest that it could rise to as much as 2.8 per cent, which would represent a significant increase. If it lands at the higher end of that range, the central bank would have more than enough incentive to increase its policy rate.

“As a result, financial traders are pricing in about a 76 per cent chance of a hike within the next six months because the government is forecasting that inflation will gain momentum in early 2027,” he said.

-- BERNAMA