Eyes on OPR
BANK Negara Malaysia’s Monetary Policy Committee meets this week for its first meeting of the year, with most economists expecting the overnight policy rate (OPR) to stay at 2.75%.
All four analysts surveyed in a Bloomberg poll expect the central bank to keep the policy rate unchanged at 2.75%.
UOB Global Economics & Markets Research economists Julia Goh and Jasrine Loke also expect Bank Negara Malaysia (BNM) to keep the OPR unchanged at 2.75% for a third straight meeting, supported by resilient gross domestic product growth momentum, benign inflation and sustained financial stability.
SME Bank and BMI also expect BNM to leave the OPR unchanged at 2.75% throughout 2026. BNM is also scheduled to announce its international reserves as at Jan 15 this week.
The Statistics Department is expected to announce the consumer price index (CPI) and external trade figures for December 2025, along with the leading, coincident and lagging indexes.
December CPI is expected to come in at 1.4% year-on-year (y-o-y), unchanged from November, according to Bloomberg and UOB estimates.
UOB estimates exports growth at 0.5% y-o-y, imports at 8.5% y-o-y, and the trade balance at a surplus of RM9.7bil.
China GDP
CHINA is expected to release a raft of economic data this week, including fourth-quarter 2025 GDP, industrial production, retail sales, and the one- and five-year loan prime rate (LPR) fixings.
Bloomberg estimates 4Q25 GDP at 1.1% quarter-on-quarter (q-o-q), seasonally adjusted, and 4.5% y-o-y.
Meanwhile, UOB expects growth at 1.2% q-o-q and 4.4% y-o-y, easing from 1.1% q-o-q and 4.8% y-o-y in the third quarter.
Bloomberg and UOB both see full-year GDP growth at 5.0% in 2025, unchanged from 2024.
ING expects growth to slow to 4.5%y-o-y in 4Q25, with full-year growth seen at 5.0%, and also sees no change in the LPR rate.
Bloomberg estimates the one- and five-year LPR will be kept unchanged at 3.00% and 3.50%, respectively.
BI decision
ECONOMISTS expect Bank Indonesia (BI) to keep its policy rate unchanged at 4.75% this week. ING said the rupiah weakened against the US dollar in 2025 amid softer trade performance, widening rate differentials and fiscal concerns.
While its base case still assumes a further 50 basis points of rate cuts this cycle to support growth, ING said risks are skewed toward a delay as the rupiah remains under pressure.
All six analysts surveyed in a Bloomberg poll expect BI to keep its policy rate unchanged at 4.75%.
