Bank Negara lowers SRR to 1%, boosting system liquidity
File pic - AZMAN GHANI/ The Star
KUALA LUMPUR: Bank Negara will lower banks' statutory reserve requirement (SRR) ratio by 100 basis points, from 2% to 1%, effective May 16, 2025.
The central bank, in a statement, said the decision to reduce the SRR is part of its continuous efforts to ensure sufficient liquidity in the domestic financial system.
'This will facilitate banks to better manage liquidity in an environment of greater financial market volatility and provide continued support for financial intermediation activity.
'The SRR reduction will release approximately RM19bil worth of liquidity into the banking system,' Bank Negara said.
The SRR is an instrument to manage liquidity and is not a signal on the stance of monetary policy.
The overnight policy rate (OPR) is the sole indicator used to signal the stance of monetary policy and is announced through the Monetary Policy Statement released after the Monetary Policy Committee meeting.
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