Lim pointed out that the last OPR hike in July had no effect on the inflation rate, with the consumer price index, which measures inflation, rising to 4.4% that month.

Instead, the former finance minister said, the current inflation was caused by excessive demand and an increase in costs, which he attributed to supply chain disruptions due to lockdowns in China and the Russia-Ukraine conflict.

“Hiking the OPR would also be a slap in the face to Annuar Musa, the chairman of the anti-inflation task force, who claimed that inflation and soaring food prices are under control,” he said in a statement.

Lim also said raising the OPR has not helped strengthen the ringgit in the currency market, describing it as “an exercise in futility” compared to the US Federal Reserve’s more aggressive rate hikes.

“Hiking the OPR would adversely affect the people’s socioeconomic well-being, the domestic investment climate, and the country’s post-pandemic economic growth amid pressure from rising prices,” he said.

Yesterday, Moody’s Analytics said it was expecting the central bank to raise its OPR by 25 basis points to 2.5% this week, its third consecutive rate hike.

This, it said, is aimed at helping ease the country’s inflation coupled with a robust economic rebound.

BNM’s monetary policy committee is scheduled to meet tomorrow and on Thursday.