Malaysia’s pivot is now unmistakeable. After a year of standing still, Bank Negara Malaysia (BNM) has cut the OPR - and the ripple effects are spreading. Liquidity is looser, growth is softening and inflation remains muted. The Ringgit is still under pressure, black-market FX has crept back in and banks continue to cap overseas card use. For now, policy is still wrapped in calm language. But the truth is clear: the tightening cycle is over, and a new phase has begun.
Monetary Policy
On 9th July, BNM cut the Overnight Policy Rate by 25bp to 2.75% - the first rate move in five years. The corridor around the OPR was also shifted down, bringing the floor to 2.50% and the ceiling to 3.00%. The timing wasn’t random: the move landed just as the 90-day US tariff moratorium expired, giving Malaysia a buffer without raising alarms.
This comes on the back of the Statutory Reserve Requirement cut in May, which quietly injected MYR 19 billion into the system - the first sign that easing had already...
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