Economists foresee Malaysia's growth to moderate in 2H amid global uncertainties

Xinhua
27 Jun 2025, 17:15 GMT+10

KUALA LUMPUR, June 27 (Xinhua) -- Economists foresee Malaysia's economic growth to ease in the second half of 2025 amid global uncertainties, including slowing economic growth and rising geopolitical tensions.

Hong Leong Investment Bank Research said in a report on Thursday that it expects Malaysia's growth to proceed at a more moderate pace in the second half, following a pullback from export orders as businesses adjust inventory levels amid elevated policy uncertainty stemming from the unpredictability of U.S. policies.

"As such, we maintain our 2025 gross domestic product (GDP) forecast at 4 percent year-on-year," it said.

Ta Securities also said in a report on Wednesday that Malaysia's near-term outlook remains clouded by global trade tensions and policy uncertainties.

"Looking ahead, growth momentum may ease further in the second quarter amid weaker economic activity and deteriorating sentiment, particularly due to persistent global trade tensions," said the research house.

Domestic demand, especially private consumption, is expected to remain the primary driver of Malaysia's economic growth, it added.

Maybank Investment Bank also said in its recent report that the second quarter likely saw a continued moderate downward trajectory in growth based on the latest weak economic indicators.

"External headwinds are centered around the elevated uncertainties caused by the twists and turns, as well as overhangs in U.S. trade policy and tariff actions, as well as the outcomes of Malaysia's trade and tariff negotiations with the U.S.," said the research house.

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