By Chan Wei Chao (REN 39846), Team Leader, Bricksmen Team · IQI Realty Sdn. Bhd. · Updated 31 October 2026
Bank Negara Malaysia (BNM) will announce its last interest rate decision of 2026 on Thursday, 5 November, and economists do not agree on what it will do. Most research houses expect the Overnight Policy Rate (OPR) to stay at 2.75%, but Nomura expects a hike to 3% next week and UOB says a hike could come as early as this meeting.
Here is where the rate stands, what each side expects and why, and what a hike would mean for your home loan.
Where things stand
| Measure | Latest |
|---|---|
| OPR | 2.75%, unchanged since a 0.25-point cut in July 2025; held again in September 2026 |
| Next decision | Thursday, 5 November 2026 (last meeting of the year) |
| Inflation, September 2026 | 1.8% (August: 1.9%); core inflation 1.7% |
| GDP growth, Q3 2026 | 5.3% (Q2: 6.0%) |
| US Federal Reserve, 28 October | Held at 3.75%–4.00%, with two members voting for a hike |
What economists expect
| Research house | 5 November | After that |
|---|---|---|
| Nomura | Hike to 3.00% | — |
| UOB | Hike possible, to 3.00% in Q4 2026 | Gradual normalisation |
| PIVB Research | Hold at 2.75% | Possible rise to 3.00% in 2027; calls a November hike an “upside risk” |
| Kenanga Research | Hold | Hike to 3.00% in Q1 2027, then a long pause |
| RHB Research | Hold | One 0.25-point hike in the first half of 2027 |
| Apex Securities | Hold | 0.25-point hike in 2027 |
| TA Research | Hold | Hike possible, but less likely in the near term |
| BIMB Research | Hold | Hold at 2.75% through 2027 |
| Pantheon Macroeconomics | Hold | Prolonged hold |
The case for a hike
- Growth is still solid. Nomura expects the economy to grow above its potential into 2027.
- Budget 2027 will add spending power through higher minimum wages, bigger cash transfers and tax relief.
- BNM’s tone has changed. UOB pointed to the governor’s remarks on 15 October about having more room to move rates, and BNM has said keeping rates low for too long could encourage excessive risk-taking.
The case for holding
- Inflation is low. Headline inflation eased to 1.8% in September and core inflation to 1.7%.
- Growth slowed in Q3, to 5.3% from 6.0% in Q2.
- Subsidies and price controls are limiting the pass-through of higher global energy prices. TA Research also notes that a US rate rise or a weaker ringgit would not automatically force BNM to follow.
What a hike would mean for your home loan
Most Malaysian home loans are on floating rates linked to the bank’s Standardised Base Rate (SBR), which moves with the OPR. If the OPR rises by 0.25 percentage points and your bank passes on the full increase, your instalment goes up. The table below is our illustration for a 35-year loan, assuming the loan rate rises from 4.00% to 4.25%. Your actual rate depends on your bank.
| Loan amount | Monthly instalment at 4.00% | At 4.25% | Extra per month | Extra per year |
|---|---|---|---|---|
| RM500,000 | About RM2,214 | About RM2,289 | About RM76 | About RM907 |
| RM800,000 | About RM3,542 | About RM3,663 | About RM121 | About RM1,451 |
A higher OPR would also raise the rate banks use to test how much you can borrow, which can slightly lower the maximum loan you qualify for. Fixed deposit rates would usually rise too.
If you are planning to buy, check your numbers with our mortgage calculator and DSR calculator at a slightly higher rate, so a hike does not stretch your budget. First-time buyers can also read about the SJKP home loan guarantee under Budget 2027, or browse Penang projects under RM500,000.
Frequently asked questions
When is the next OPR announcement?
Thursday, 5 November 2026. It is BNM’s last monetary policy meeting of the year.
What is the OPR now?
2.75%. BNM last changed it in July 2025, when it cut the rate by 0.25 percentage points.
Will BNM raise the OPR in November?
Economists are divided. Nomura expects a hike to 3% and UOB says one is possible, while Kenanga, RHB, PIVB, Apex, TA, BIMB and Pantheon expect a hold. Several expect a hike in 2027 instead.
How much would a 0.25% hike add to my home loan?
In our illustration, about RM76 a month on a RM500,000, 35-year loan, if the bank passes on the full increase.
Planning to buy in Penang?
I can help you compare new projects and work out a comfortable budget before the rate decision. WhatsApp or call +60 10-313 9113.
Sources
- The Star (via Webull): Rate normalisation in focus
- The Edge Malaysia: Softer September inflation supports OPR hold, but economists split on hike timing
- Kenanga Research: Economic Viewpoint, 29 October 2026
- 国家银行11月5日召开今年的最后一次货币政策会议
This article is general information based on published economist forecasts and reports as of 31 October 2026. It is not financial advice. Loan figures are illustrations only; actual instalments depend on your bank’s rate, loan amount and tenure.