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Malaysia CB Holds Rate Unchanged Again

Malaysia central bank left its key interest rate unchanged for a second straight policy session, after cutting it in May, as policymakers assessed the current stance as supportive of economic activity.

The Monetary Policy Committee of Bank Negara Malaysia decided to leave the overnight policy rate at 3.00 percent. The outcome of the meeting came in line with expectations.

"At the current level of the OPR, the stance of monetary policy remains accommodative and supportive of economic activity," the central bank said in a statement.

The previous change in the interest rate was a quarter-point reduction in May, which was the first cut since July 2016.

The baseline growth projection for 2019 remains broadly unchanged, within the range of 4.3-4.8 percent. This projection, however, is subject to further downside risks from worsening trade tensions, uncertainties in the global and domestic environment, and extended weakness in commodity-related sectors, the bank added.

The central bank expects headline inflation to average higher for the remaining months of the year and into 2020, yet remain low.

Core inflation is expected to remain stable, supported by the continued expansion in economic activity and in the absence of strong demand pressures, the bank said.

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