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Monthly Review: Resilient domestic fundamentals anchor ringgit’s regional outperformance

Malaysia’s full-year gross domestic product (GDP) growth is on track to reach the upper end of Bank Negara Malaysia’s (BNM) projection of 4.0%–4.8%, supported by stronger 3Q2025 GDP which expanded by 5.2% after two consecutive quarters of registering a 4.4% growth. Reflecting this acceleration, market consensus has revised its 2025 GDP growth forecast upwards to …

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Monthly Review: Malaysia’s growth prospects strengthen amid global crosscurrents

Malaysia is poised for stronger 3Q2025 growth, with advance estimates pointing to a 5.2% gross domestic product (GDP) growth, above the 4.2% consensus. The services sector held steady at 5.1% (2Q2025: 5.1%) on resilient household spending and retail activity, while manufacturing accelerated to 4.0% (2Q2025: 3.7%). The mining sector, having weighed on growth earlier in …

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Budget 2026: Fiscal continuity and the pursuit of domestic resilience

On 10 October 2025, the Malaysian government announced an allocation of RM419.2 billion under Budget 2026, representing 19.7% of gross domestic product (GDP). Of this amount, RM338.2 billion is designated for operating expenditure, whereas RM81.0 billion is allocated for development expenditure. While Budget 2026 has increased slightly from the 2025 revised estimates, it incorporates downward-revised …

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Monthly Review: Malaysia’s trade declines on external uncertainties

Malaysia’s imports declined by 5.9% in August, mainly from reduced intermediate goods which made up over half of total imports, while exports rose modestly by 1.9% to RM131.6 billion, mainly supported by demand for electrical and electronics (E&E), machinery and equipment, optical and scientific instruments, and palm oil and palm-based agricultural products. E&E remained the …

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Monthly Review: Malaysia’s exports rebound as tariff cuts restore demand

Malaysia’s 2Q2025 gross domestic product growth came in at 4.4% (1Q2025: 4.4%), slightly below the advance estimate of 4.5%. Growth was underpinned by the services sector, which expanded by 5.1% (1Q2025: 5.0%). Meanwhile, manufacturing growth moderated to 3.7% (1Q2025: 4.1%), weighed down by heightened tariff-related uncertainties during the quarter while the construction sector sustained double-digit …

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MARC Ratings: Malaysia’s 13MP signals reform commitment

On 31 July 2025, the Malaysian government unveiled the 13th Malaysia Plan (13MP), outlining the country’s development framework for the next five years (2026–2030). Key highlights include total investments amounting to RM611 billion, of which RM430 billion is earmarked for development expenditure. This translates into RM86 billion annually, on par with the development allocations in …

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Monthly Review: Trade uncertainties weigh on growth prospects

Malaysia’s 2Q2025 gross domestic product (GDP) growth advance estimate of 4.5% is underpinned by the services sector’s resilient expansion of 5.3% (1Q2025: 5.0%), driven by robust private consumption and front-loaded external demand in April. However, export performance continued to soften, contracting by 3.5% in June (May: -1.1%), weighed down by persistent weakness in the manufacturing …

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2H2025 Outlook: Growth to moderate amid trade risks and policy uncertainty

Global economic growth is expected to moderate in 2H2025 as trade tensions and geopolitical risks weigh on sentiment. The US’ sweeping tariffs have reignited protectionist concerns, contributing to slower global growth. The US economy contracted by 0.2% in 1Q2025, with the Purchasing Managers’ Index for both manufacturing and services falling below the neutral 50 mark …

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