NEWS: SERC says current OPR level is ‘just right’

According to Lee Heng Guie, the executive director for the Socio-Economic Research Centre, the current level of the OPR remains accommodative.

Transcript

00:00 case of Malaysia, there's something that we also have to take note is that we have high

00:04 household debt. So I think at this moment, I think at this 3%, there are some who are

00:11 impacted. They are impacted because those who have high debt level and you are at quite

00:19 low income and you have debt loan to service, the 3% really add on a bit of your service

00:26 payment, your debt service payment. At the same time, the business side, the business

00:33 side also be affected, right? The cost of doing business. And at the moment, I think

00:39 at least our interest rate now of 3% is higher than your inflation. So you are net positive.

00:49 You are no longer in the net negative. Before that, inflation was 3+%, 4%, then the OPR

00:55 was lower, so it's a negative. So negative, that would be, you keep the negative too low,

01:01 too long or too low, and then you encourage people to go and borrow more. So I think at

01:06 this level, it's just right. We don't have to be pushing to the max yet. So at the moment,

01:12 it would not significantly hurt people who are indebted. At the same time, you are also

01:20 not discouraging people to activity.

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