Business

Malaysia hikes rates for first time since 2014

KUALA LUMPUR: Malaysia hiked interest rates yesterday for the first time in more than three years, making it the latest country to tighten monetary policy as the global economy improves.

The central Bank Negara Malaysia lifted its overnight policy rate by 25 basis points to 3.25 per cent, in line with expectations.

It last announced an increase in July 2014.

"The global economy has strengthened further," the bank said in a statement, adding that the economy also looked set to continue its recent upward momentum, underpinned by strong domestic demand.

The decision could be a boost for Prime Minister Najib Razak, who must call general elections by August.

After a few turbulent years, South-east Asia's third largest economy bounced back strongly last year and the government is predicting strong growth of 5.5 per cent this year.

Malaysia's central bank is the latest to tighten monetary policy.

South Korea lifted interest rates for the first time in more than six years in November, while the US Federal Reserve hiked rates three times last year.- AFP

BUSINESS & FINANCE