Malaysia Holds Key Rate, Cuts Reserve Ratio in Dovish Tilt

Malaysia kept interest rates unchanged on Thursday, but moved to release more funds into the banking system amid looming risks to growth from US President Donald Trump’s tariffs.

Bank Negara Malaysia left the overnight policy rate at a post-pandemic high of 3%, as predicted by 20 of 25 economists in a Bloomberg survey. The rest expected a 25-basis point cut — the first time easing bets have come into play since the Monetary Policy Committee adjusted the key rate to its current level in May 2023.