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Malaysia Holds Rates Steady For Sixth Straight Session

Malaysia's central bank left its key interest rate unchanged in January for a sixth policy session in a row, saying that the economy is expected to remain on a steady growth path this year, despite downside risks.

The Monetary Policy Committee decided to maintain the Overnight Policy Rate at 3.25 percent, the Bank Negara Malaysia said on Thursday. The decision was in line with economists expectations.

The previous change in the key interest rate was a quarter-point hike in January.

"At the current level of the OPR, the degree of monetary accommodativeness is consistent with the intended policy stance," the bank said.

"The MPC will continue to monitor and assess the balance of risks surrounding the outlook for domestic growth and inflation."

Latest indicators point towards sustained economic expansion and domestic demand is set to remain the key driver of growth this year, the bank said.

Meanwhile, the external sector is likely to soften amid moderating global growth.

"Risks to growth are tilted to the downside, primarily from potential escalation of trade tensions and commodity-related shocks," the central bank said.

"On balance, the Malaysian economy is expected to remain on a steady growth path in 2019."

Bank Negara expects headline inflation to moderately rise this year from the 1 percent averaged in 2018.

While the trajectory for headline inflation will depend on the trend in oil prices, underlying price growth is expected to remain contained in the absence of strong demand pressures, the bank said.

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