KUALA LUMPUR, March 6 Malaysia's central bank
held its key interest rate steady at 3.0 percent on Thursday, as
expected, reiterating that a rise in inflation was expected to
be contained as domestic spending cools.
"Going forward, inflation is expected to be affected by
higher domestic costs," Bank Negara Malaysia's monetary policy
committee said in a statement.
"The subdued external price pressures and moderate domestic
demand conditions will, to some extent, contain the impact of
these cost factors on the underlying inflation."
(Full text of central bank's statement: )
The annual inflation rate accelerated to 3.4 percent in
January, a 27-month high, reflecting a hike in prices of food,
transport and electricity.
Malaysia's policy rate has been steady since mid-2011, and
all 17 economists in a Reuters poll expected the central bank to
keep it unchanged on Thursday. Most analysts expect no change
until the second half of 2014.
Malaysia's economy beat expectations and picked up speed in
the last quarter of 2013, with exports rebounding as a gradual
recovery in the global economy spurred more shipments of
electronics and commodities.
Most economists expect Malaysia's economy to grow at a
robust 5 percent or more this year, following an expected
expansion of 4.5-5.0 percent for full-year 2013, helped by a
brighter global economy that should aid its vital export sector.
(Reporting by Hawa Semasaba; Editing by Stuart Grudgings)