Malaysia’s central bank kept its benchmark interest rate steady at 3 per cent, as expected by economists, and flagged a continuation of domestic growth.

In its accompanying policy statement, Bank Negara Malaysia noted the improvement in domestic economic growth in the second half of last year had continued into the first three months of 2017 and is now expected “to be sustained for the rest of the year.”

Growth will be driven primarily by wage and employment growth – boosting domestic demand – and the implementation of new and ongoing investment projects.

Headline inflation, of 4.3 per cent during the March quarter, was in line with the central bank’s forecast but policymakers said the trend of domestic headline inflation was dependent on future global oil prices “which remain highly uncertain”.

The bank also said the ringgit has continued to stabilise. It hit a 19-year low against the dollar in January of 4.4975 to the dollar, but has since recovered to 4.349 today.

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