KUALA LUMPUR, Aug 26: Malaysia’s central bank has kept its benchmark interest rate unchanged at 3.5 per cent for a third straight meeting as the country’s inflation eases, a report said on Saturday.

The central bank said inflation was expected to moderate for the rest of the year, the Star newspaper said.

“While the external environment may become less favourable in the second-half of the year due to an anticipated softening of global growth, its impact on the domestic economy is expected to be modest,” the central bank said in a statement.

Malaysia’s inflation had peaked and the rate would moderate in the second half of the year, central bank chief Zeti Akhtar Aziz said early this month after raising interest rates three times since November.

Inflation soared to 4.8 per cent in March, the highest level in six years, but eased back to 4.6 per cent in April and to 3.9 per cent in May, and held steady at the same level in June.

The central bank in April raised its key interest rates by 25 basis points to 3.50 per cent in a bid to combat rising inflation following steep fuel price hikes.

—AFP