OPR increase will not impact investments much, says Mustapa

The increase in the overnight policy rate (OPR) announced on Thursday will not impact much investments or investor sentiment and confidence, said International Trade and Industry Minister, Datuk Seri Mustapa Mohamed.

"Malaysia will continue to be an attractive destination for investments and attract not only those from overseas but also the domestic front.

"The OPR increase is minimal and it has to do with the bigger picture in terms of the economic position, such as the slight increase in the inflation rate and domestic debt," he told reporters at the launch of his ministry's 2013 report here today.

Bank Negara Malaysia announced a 25 basis points increase in the OPR to 3.25 percent.

Mustapa said there is a need to make some adjustments as concerns have been expressed of late on the size of the household debt and believed this had been taken into consideration.

"This move (OPR increase) will provide some cushioning towards the increase in household debt.

"There might be a small impact on domestic consumption. But in my view, it is not going to be much.

"In the meantime, Malaysians need to be a little cautious in terms of consumption," he added.