Malaysia Interest Rate

The Central Bank of Malaysia held its benchmark interest rate steady at 3% during its May 2025 meeting, marking the eleventh consecutive period of unchanged rates and aligning with market expectations. The central bank reiterated its supportive stance on economic growth, noting that the current policy setting remains appropriate in light of its latest assessment of inflation and growth prospects. Headline and core inflation averaged 1.5% and 1.9%, respectively, in the first quarter of 2025, with overall inflation expected to remain manageable for the rest of the year amid moderate global costs and subdued domestic demand pressures. Meanwhile, preliminary estimates showed that the country's annual GDP growth slowed to a one-year low of 4.4% from 5% gain in the previous quarter. Looking ahead, although growth is expected to be anchored by resilient domestic demand, escalating trade tensions and heightened global policy uncertainties are likely to weigh on the external sector.