KUALA LUMPUR, March 5 (Xinhua) -- Malaysia's central bank, Bank Negara, announced on Tuesday the decision to maintain its Overnight Policy Rate (OPR) at 3.25 percent.
The central bank said in a statement that at the current level of the OPR, the degree of monetary accommodations is consistent with the intended policy stance.
However, recognizing downside risks in the economic and financial environment, the central bank said it will continue to monitor and assess the balance of risks surrounding the outlook for domestic growth and inflation.
Despite the country's headline inflation in January was at -0.7 percent, the core inflation remained stable at 1.5 percent, reflecting sustained demand conditions.
"In the immediate term, inflation is expected to remain low mainly due to policy measures," it said, adding that the measures include the lower price ceiling on domestic retail fuel prices until mid-2019 and the impact of changes in consumption tax policy on headline inflation.
For 2019, the central bank expects average headline inflation to be broadly stable compared to 2018.
"Underlying inflation is expected to be sustained, supported by the steady expansion in economic activity and in the absence of strong demand pressures," it said.
The central bank also expects Malaysia's economy growth to be sustained this year, backed by private sector spending.
