Malaysia Interest Rate

The Central Bank of Malaysia lowered its benchmark interest rate by 25 basis points to 2.75% during its July 2025 policy meeting, in line with market expectations. This marked the first rate cut in five years, underscoring the central bank's commitment to supporting domestic economic momentum amid a weaker growth outlook and rising global trade uncertainties. Headline and core inflation averaged 1.4% and 1.9%, respectively, in the first five months of the year. For the full year, inflation is expected to remain moderate, supported by subdued global cost pressures and the absence of significant domestic demand-driven inflation. Meanwhile, Malaysia's GDP expanded by 4.4% year-on-year in the first quarter of 2025, aligning with earlier estimates but easing from a revised 4.9% growth rate in the previous quarter. Indicators suggest that economic activity remained robust in the second quarter, driven by resilient domestic spending and steady export performance.