At the Monetary Policy Committee (MPC) meeting on 5th May 2011, Bank Negara Malaysia decided to raise the Overnight Policy Rate (OPR) by 25 basis points to 3.00 percent with immediate effect. The floor and ceiling rates of the corridor for the OPR are correspondingly raised to 2.75 percent and 3.25 percent respectively.
Following this, banks will Base Lending Rate (BLR) & Base Financing Rate (BFR) later. For those who have variable loans specially home loan, will have to pay more in their monthly installment. On the positive side, the increase also will raise the current fixed deposit rate. For the latest BLR & BFR rate kindly refer to Rate Page.
On the other development, Bank Negara Malaysia also increase in the Statutory Reserve Requirement (SRR) Ratio for banks from 2.00% to 3.00%, effective from 16 May 2011. This changes also may resulted in higher BLR & BFR rate.
Bank Negara decide to raise the SRR as a pre-emptive measure to manage the significant build-up of liquidity, which may result in financial imbalances and create risks to financial stability.