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Malaysia holds interest rate at 2.75%, flags geopolitical risk

Bank Negara says the current rate is appropriate and supportive of the economy amid price stability

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Tan Ai Leng

Tan Ai Leng

Published Thu, Mar 5, 2026 · 04:06 PM
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    • The central bank is taking a cautious stance as the prospect of a prolonged war in Iran risks spurring energy prices and currency volatility, complicating the outlook for inflation and growth.
    • The central bank is taking a cautious stance as the prospect of a prolonged war in Iran risks spurring energy prices and currency volatility, complicating the outlook for inflation and growth. PHOTO: REUTERS

    [KUALA LUMPUR] Bank Negara Malaysia kept its benchmark overnight policy rate (OPR) steady at 2.75 per cent on Thursday (Mar 5), cautioning that global economic stability remains under pressure due to heightened geopolitical tensions in the Middle East.

    The OPR, the interest rate for overnight interbank lending, has remained at this level since a 25-basis-point cut in July 2025. The central bank maintained that the current rate is “appropriate and supportive of the economy amid price stability”.

    While expressing confidence on domestic economic growth, Bank Negara highlighted rising downside risks stemming from geopolitical tensions and uncertainties surrounding trade tariffs, which could dampen global trade and commodity production.

    Bank Negara MalaysiaInterest ratesAsean

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