KUALA LUMPUR: The July reduction in the Overnight Policy Rate (OPR) is expected to continue to support economic growth in Q4 2025 and into next year.
The Finance Ministry said the 25 basis point cut to 2.75% has begun to show effects within the banking system.
The ministry said reference rates such as the Standard Base Rate and the Base Rate have been fully adjusted in line with the OPR cut.
As a result, repayments for households and small and medium enterprises with floating rate loans tied to these rates are now generally lower.
Eligible households and SMEs taking new loans could potentially benefit from lower financing costs, which should support spending and business activity.
This was stated in a Parliamentary written reply published on Oct 28.
The reply answered Datuk Awang Hashim’s question on the impact of OPR changes on financing costs for households and SMEs and related fiscal measures.
The ministry said the government will continue support programmes for households and SMEs facing financial pressure and payment difficulties.
These include Bank Negara Malaysia funds for SMEs, targeted bank repayment assistance and advisory services.
Programmes by the Credit Counselling and Debt Management Agency include the Debt Management Programme and the Small Loan Resolution Scheme.
The ministry said efforts to raise incomes, ease household burdens and support the business ecosystem will continue.
Measures include raising the private sector minimum wage and reviewing the civil service salary scheme.
They also include improving the business environment and strengthening human capital and digital capacity through key policies.
These policies include the New Industrial Master Plan 2023 and the National Energy Transition Roadmap.
The ministry said these initiatives are crucial to attract high value investment and improve productivity and competitiveness.
They also create new employment opportunities over the long term.
