KUALA LUMPUR: Umno information chief Isham Jalil has asked Bank Negara Malaysia (BNM) to justify its need to raise the overnight policy rate (OPR) from 2.75% to 3.25% this month.
He said increasing the OPR, which is the interest rate a borrower has to pay for a bank loan, will burden the people who are suffering from the high cost of living and related issues.
“If you increase the OPR by even 1%, BNM will collect approximately RM12 billion a year from debtors, which means that the banks would pocket RM1 billion a month from borrowers.
“I don’t think even the government collects that amount of money each month,” he said.
“What is BNM’s rationale for wanting to raise the OPR? When I was working in the Prime Minister’s Office, we raised the fuel price by a few per cent but everyone was at our throats. Now, BNM is saying it will do the same thing. Their actions will have a bigger impact on the people and would increase their monthly cost of living by about RM100.”
Isham said increasing the interest rate would raise the costs of running a business and this would only shift the burden to consumers, as a high OPR would make it more expensive to borrow money.
“When BNM raises the OPR and our wages cannot keep up with the consequent increase in the cost of living, this will only aggravate inflation. Businesses have to pay more for rental of premises while the people will be forced to pay more for their mortgages,” he said, adding that BNM must justify any increase in the OPR before raising it.
Prime Minister Datuk Seri Anwar Ibrahim said on Wednesday: “All changes relating to OPR are decisions of BNM and not the Finance Ministry or the government itself. I can discuss it if needed, but that is the prerogative of BNM”.
Anwar said the central bank is mandated to promote “monetary and financial stability” that is conducive to the continued growth of the economy.
He added that a joint discussion involving BNM governor Nor Shamsiah Mohd Yunus and Economic Affairs Minister Rafizi Ramli would be held before drafting Budget 2023.
He also said: “ I invited the BNM governor and economic affairs minister to discuss this. This is an approach that I used to do. It is not foreign to me because the action of any party will also involve the overall economic policy”.
Anwar, who is also finance minister, is scheduled to table Budget 2023 in the Dewan Rakyat on Feb 24.
