KUALA LUMPUR: Bank Negara will continue to monitor the prevailing economic and financial developments before deciding on further adjustments to the overnight policy rate (OPR) and statutory reserve requirement (SRR) in 2020.
Governor Datuk Nor Shamsiah Mohd Yunus said the central bank had cut the OPR by 100 basis points to the current 2%, translating into a lower lending rate.
“As 75% of loans in Malaysia’s banking system are floating-rate loans, the lower borrowing cost will reduce the debt burden of household and businesses, and support credit expansion as the economy improves in the second half of 2020, ” she said.
Nor Shamsiah said the OPR reductions also translated into a lower rate of the domestic bond market, which subsequently would support the capital market financing.
On the SRR adjustment in March and May 2020, she said the move had collectively released about RM46bil worth of liquidity into the banking system. — Bernama