KUALA LUMPUR, May 11 (Bernama) -- Bank Negara Malaysia retained its
Overnight Policy Rate (OPR) at three per cent for the sixth time, at its
Monetary Policy Committee (MPC) meeting here today.
The central bank in a statement said while the Malaysian economy was
affected by global developments, domestic demand continued to support
growth, driven by firm consumption and investment activity.
"Looking ahead, this trend is projected to continue. Private consumption is
supported by stable employment conditions, income growth and public sector
measures," it added.
Bank Negara said investment activity was mainly led by domestic-oriented
industries as well as the commodity and public sectors.
On inflation, it said headline inflation is expected to moderate this year,
with improved domestic supply and stable demand conditions.
However, upside risks to inflation could emerge, particularly from global
supply disruptions and result in higher global prices for energy and
commodities, it added.
The central bank said while the global economy continued to recover,
developments in the most recent period, had increased the risks to global
growth.
"Stress in the international financial markets has re-emerged following
rising policy uncertainties and renewed concerns over the sovereign debt crisis
in the euro area," it added.
Apart from that, Bank Negara said economic activity in Europe also continued
to be weighed down by the ongoing fiscal consolidation, impaired financial
intermediation and weak labour market conditions.
As for North America, recent economic data had been mixed, indicating
uncertainty in the pace of the economic recovery, it added.
On Asia, it said while economic activity continues to be supported by
domestic demand, the growth momentum is affected by the slowdown in
international trade activity.
"In the MPC’s assessment, there remain continued uncertainties emanating
from the global economic and financial environment. The MPC will continue to
carefully assess these evolving conditions, their implications on the overall
outlook for inflation and growth of the Malaysian economy," the central
bank added.-- BERNAMA
NBB AS