Bank Negara raises key interest rate to 2.5pc

Bank Negara Malaysia yesterday raised the Overnight Policy Rate (OPR) by another 25 basis points (bps) to 2.5 per cent, in a further move to normalise monetary conditions.

The move to raise borrowing costs, through the benchmark interest rate, had been widely anticipated by the market.

Bank Negara governor Tan Sri Dr Zeti Akhtar Aziz said that at the new level, the stance of the monetary policy continues to be accommodative and supportive of economic growth.

It was the second time this year that the central bank had raised the OPR, after the 25 bps increase in March.

Most economists polled by Business Times said they expected further increases in the benchmark interest rate before the end of the year.

"The rates were initially brought down under exceptional conditions, but (they) do not prevail as the Malaysian economy is firmly on the path of recovery and we expect it to improve in the remaining quarters on domestic demand, investment activities and trade with Asia remaining robust. Bank Negara will continue to monitor the situation in our next meeting in July," Zeti said.

Inflation is moderate and the headline inflation rate, as measured by the change in the Consumer Price Index, increased to 1.3 per cent in the first quarter. - By Rupa Damodaran (Business Times)


May 14, 2010 at 10:06 AMUnknown

RHB revises BLR to 6.05%

KUALA LUMPUR: The RHB banking group will revise its base lending rate per annum for RHB Bank Bhd and RHB Islamic Bank's base financing rate from 5.80% to 6.05% with effect from Monday.

It said in a statement that the new FD rates, also effective May 17, were 2.5% for 1-5 months (previously 2.25% for 1-11 months), 2.70% for 6-11 months, 3.00% for 12 months (previously 2.60%) and 3.10% for 13-35 months.

Group managing director Datuk Tajuddin Atan said this was in line with Bank Negara's move to raise the overnight policy rate.

May 14, 2010 at 11:01 AMkeong16

this good to cool down the highend condominium price and sales,let developer slow down the price oslo,good new for real buyer,,,,

May 15, 2010 at 11:35 AMPrasad

and this is where the bubble starts to crack.

May 15, 2010 at 12:05 PMKevin

0.25% only...i don't think will have any serious impact to the so called bubble la... for roughly a RM500k loan...that's less than RM100 difference a month....

July 9, 2010 at 12:49 AMGreg

Today, Bank Negara raised interest rate AGAIN for the 3rd time in 4 months time. Another 25 bps.