FX.co ★ Malaysia Keeps Rates Steady for 3rd Meeting

The Central Bank of Malaysia has maintained its key interest rate at 2.75% for the third consecutive time during its January 2026 meeting, which is the first monetary policy decision of the year and aligns with market predictions. The board deemed this decision appropriate to foster economic growth while maintaining stable prices. In 2025, headline inflation averaged 1.4%, and core inflation stood at 2.0%. Looking forward, it is anticipated that headline inflation will remain moderate throughout 2026 due to the continued easing of global cost pressures, while core inflation is expected to remain stable, close to its long-term average. Preliminary figures indicate that the economy expanded by 4.9% in 2025, slowing from a growth of 5.1% in 2024. Growth is projected to persist in 2026, driven by robust domestic demand. Nonetheless, the outlook is fraught with uncertainties, particularly concerning evolving global developments. The Monetary Policy Committee (MPC) has indicated that it will continuously monitor ongoing conditions and evaluate the balance of risks affecting the outlook for domestic growth and inflation.