Juwai IQI – Expectations Climb That Bank Negara Will Raise Rates, but  Not This Month 

Press Release: Juwai IQI – Expectations Climb That Bank Negara Will Raise Rates, but  Not This Month 

Kuala Lumpur, 27th August 2026 — Bank Negara’s Monetary Policy Committee cut interest rates  by 25 basis points to stimulate the economy just over a year ago, in July 2025, and pressure is  rising on the central bank to reverse that move, although that is unlikely to happen at its 3  September meeting, said Juwai IQI Co-Founder and Group CEO Kashif Ansari.  

Bank Negara May Lift Rates in 2027 

“Economic growth is so strong that the bank may have to raise interest rates again soon,” he  explained. “However, we don’t believe that will happen this month. 

“Malaysia’s economy has surprised everyone with its strength. GDP growth hit 6% in the second  quarter. It looks like likely that 2026 will be the third year in a row in which GDP growth is at least  5%. 

“With growth like this, you have to worry that you might also get inflation. Yet, headline inflation has  remained below 2% so far this year. That’s low enough that the central bank probably will not feel  obliged to raise the overnight policy rate in September. 

“Malaysia’s economy is doing well compared to others in Southeast Asia. Investment experts  Bloomberg call Malaysia the ‘newfound darling of global investors.’ We are exporting technology, tourism and energy, and have kept growing despite some international instability. 

“For an example of Malaysia’s current economic dynamism just look at the investments approved  in the first quarter by the Malaysian Investment Development Authority. They are expected to  create 50,226 jobs, which is 47% more than were created by the investments from the same  quarter last year.

“Things are going so well that the central bank has already had to warn that the stronger economy  won’t necessarily lead to a rate increase. Even so, we expect interest rates will soon go higher.  Some analysts now expect Bank Negara to boost rates at its November meeting. We think they are  more likely to take that step in 2027.” 

Implications for the Residential Market 

Mr Ansari summed up what the interest rate outlook means for homebuyers, investors, and  owners.  

“Since we don’t expect a rate rise at the 3 September meeting,” he said, “mortgage costs should  hold steady in the near term.  

“Over the long term, the direction of travel looks to be upwards. That means financing is cheaper  now than it will be later. If you can buy and lock in your rates for two to three years, you may save  yourself the extra expense of higher rates during that period. 

“If you are an owner with a mortgage and have built up some equity through several years of  repayments, you can also consider refinancing to reduce your monthly costs. Imagine a  homeowner who borrowed RM400,000 at 6%, and has already paid down RM200,000 of the  principal. If they refinance into a new 30 year, RM200,000 loan at the same rate, they could reduce  their monthly payments by about RM1,200, which is 50%. 

“Talk to your financial advisor before doing this, though, because doing so also means paying more  total interest and paying off your mortgage for more years than otherwise. 

“Property investors can also take advantage of the strong economy. High household income,  employment, and economic activity all generally add up to stronger property demand, higher rents,  and price growth. Choose your properties carefully and focus on the sustainability of your real net  yields, which is your rental income minus all of your costs. 

“Looking forward, our team expects the residential market to remain stable and modestly positive.  We expect price growth of at least 1% but no higher than 3.5%. We see buyers focusing on  accessible landed homes, transit-linked condos, and properties in the job corridors. 

“Thus our outlook for rates, the economy, and the market is broadly positive.”

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