The crash: 2020
When the pandemic hit in early 2020, Bank Negara cut the Overnight Policy Rate four times in a single year — from 3.25% down to a record low of 1.75%. The OPR is the lever BNM pulls to make borrowing cheaper or dearer across the whole economy, and cutting it hard was the textbook response to a demand shock: make loans cheap, keep businesses alive, support spending.
For households the effect was double-edged. If you had a floating-rate home loan, your monthly instalment fell — cheap money in your pocket. If you relied on fixed deposit interest for income, your returns collapsed, because FD rates track the OPR down almost in lockstep.
The recovery: 2022–2023
As the economy reopened and inflation picked up, BNM reversed course. Through 2022 and into 2023 it raised the OPR back up to 3.25% in a series of quarter-point moves — unwinding the entire pandemic cut. Borrowers felt this as rising instalments; savers finally saw FD and savings rates climb back toward something meaningful.
This is the part of the chart worth internalising: the OPR is a cycle, not a level. The cheap-money years were temporary, and so was the high. Anyone who locked a long financial decision to "rates will stay where they are" got caught out twice in three years.
The step back down: 2025 to now
In mid-2025 BNM trimmed the rate by a quarter point to 2.75%, and it has held there ever since — the level on the right edge of this chart. A hold means a steady cost of borrowing and a steady return on cash: no relief for borrowers, no fresh boost for savers, just stability.
What the whole line teaches: don't bet your plan on the next move. Build a buffer so a rate rise won't break your budget, capture today's known FD rate with cash you can spare rather than waiting for a higher one that may not come, and treat any "rates will definitely go up/down" forecast with suspicion. The cycle has surprised the consensus more than once. Track every decision on the OPR Tracker, and use the FD Rate History tool to see how deposit rates followed this line down and back up again.