Kuala Lumpur (VNA) – Malaysia’s economy maintained growth momentum in the first quarter of 2026, supported by resilient domestic demand and strong export performance, according to the central bank.
In a statement released on May 7, Bank Negara Malaysia (BNM) said the latest economic indicators point to continued expansion despite external uncertainties linked to the conflict in West Asia.
The central bank noted that the duration and severity of the conflict will continue to affect Malaysia’s growth and inflation outlook in the coming months. Nevertheless, it stressed that the country’s strong economic fundamentals will underpin resilience, while employment, wage growth and policy measures will continue to support household spending.
BNM said domestic investment activity will be driven by progress in multi-year projects in both the public and private sectors, implementation of new smaller-scale public projects, strong realisation of approved investments, and the continued rollout of national master plans.
The external sector is expected to benefit from sustained growth in electrical and electronics exports, while tourism spending is projected to remain supportive, although at a more moderate pace.
The central bank warned that downside risks to growth remain, particularly if the West Asia conflict persists and commodity production weakens. On the upside, economic expansion could gain further support from easing geopolitical tensions, stronger demand for electrical and electronics products, and higher tourism activity.
Malaysia posted solid economic results in 2025, with gross domestic product expanding 5.2% for the full year and accelerating to 6.3% in the fourth quarter.
BNM previously projected Malaysia’s economy to grow between 4% and 5% in 2026, citing resilient domestic demand and a diversified export structure that would help cushion external headwinds.
On inflation, headline inflation averaged 1.6% in the first quarter of 2026, while core inflation stood at 2.1%.
BNM said higher global commodity prices resulting from the West Asia conflict may push domestic cost pressures slightly higher, but the impact on inflation is expected to remain manageable.
Malaysia’s first-quarter 2026 GDP figures are scheduled to be released on May 15./.
