Bank Negara Malaysia (BNM) has raised the overnight policy rate (OPR) by 25 basis points to 3.25 per cent at its Monetary Policy Committee (MPC) meeting today.

In a statement today, BNM said the floor and ceiling rates of the corridor for the OPR were correspondingly raised to three per cent and 3.50 per cent respectively.

It said at the new level of the OPR, the stance of monetary policy remained supportive of the economy.

The OPR has not been increased for the past three years since May 2011, it said.

BNM said after moderating in the first quarter, the global economy has resumed its path of gradual recovery.

"The economic activities in the major advanced economies continued to expand at a modest pace.

"In Asia, the better external environment is supporting growth amid continued expansion in domestic demand," it said.

The central bank said for Malaysia, the latest indicators pointed to continued strength in exports and private sector activity.

"Going forward, the overall growth momentum is expected to be sustained," it said.

BNM said exports would continue to benefit from the recovery in the advanced economies and from regional demand.

"Investment activity is projected to remain robust, led by the private sector," it said.

Private consumption would be supported by stable income growth and favourable labour market conditions, it said.

"The prospects are therefore for the Malaysian economy to remain firmly on a steady growth path," it said.

The central bank said inflation has been relatively stable as the effects of the price adjustments for utilities and energy continued to moderate.

"Demand-driven inflation remains contained.

"Looking ahead, inflation is, however, expected to remain above its long-run average due to the higher domestic cost factors.

"Amid the firm growth prospects and with inflation remaining above its long-run average, the MPC decided to adjust the degree of monetary accommodation," it said.