Interest rate hikes stir up debate, unhappiness in inflation-hit Malaysia

Politicians criticise increases, but economists say central bank cannot keep rates low

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KUALA LUMPUR - Malaysia's consecutive interest rate increases, which are expected to continue until the end of 2022, have stirred up debate and caught the attention of politicians. The country is already feeling the impact of creeping inflation amid talk of a general election in the coming months.

Bank Negara Malaysia, the central bank, has raised its overnight policy rate (OPR) three times since May, with many analysts and economists expecting it to continue similar moves until the end of 2022 - effectively bringing interest rates to pre-pandemic levels.

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A version of this article appeared in the print edition of The Straits Times on September 24, 2022, with the headline Interest rate hikes stir up debate, unhappiness in inflation-hit Malaysia. Subscribe