Monday, the Malaysian central bank lowered its key interest rate to 3.25% from 3.5%. Economists had forecast the central bank to leave the base rate unchanged.
The Bank Negara Malaysia said in a statement, "The ceiling and floor rates of the corridor for the OPR are correspondingly reduced to 3.50 percent and 3.00 percent respectively".
The central bank also cut the Statutory Reserve Requirement to 3.5% from 4%, which will take effect on December 1.
The outlook for global growth has deteriorated further, the central bank said. Citing indications of slower private sector activity amid some softening in the labor market conditions and a more challenging business environment, the Bank Negara noted that sustaining domestic demand is key to ensuring that growth in 2009 remains positive.
Inflation is expected to moderate significantly, especially in the second half of 2009, the central bank said.
"Going forward, the global economic and the international financial conditions are expected to continue to remain volatile and uncertain. Bank Negara Malaysia will monitor closely the evolving developments and will undertake the appropriate policy response to avoid a severe economic downturn", the central bank said.
The next meeting of the Monetary Policy Committee is scheduled for January 21.
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May 22, 2026 14:46 ET Minutes of the latest Fed policy session was the highlight of the week along with survey data on the U.S. housing market. In Europe, survey data signaled the trends in the euro area private sector. Further, consumer price inflation data from the U.K. was in focus. In Asia, various economic indicators from China drew attention to the health of the economy.