FX.co ★ Malaysia Projects 4.5%-5.5% Growth in 2025 Amid External Risks

The Malaysian economy is anticipated to grow by 4.5% to 5.5% in 2025, following an estimated expansion of 5.1% in 2024, according to the central bank's latest economic and monetary review. This growth is expected to be fueled by steady domestic demand, although uncertainties in the global market may impact export activities. Governor Abdul Rasheed Ghaffour highlighted the potential challenges in the international arena for 2025, emphasizing the risks associated with protectionism, geopolitical conflicts, and trade tensions.

For the current year, headline inflation is projected to range between 2% and 3.5%, while core inflation is expected to be between 1.5% and 2.5%. Although inflation is trending upwards, it is anticipated to remain manageable due to generally easing global costs and stable demand pressures. In 2024, Malaysia experienced an inflation rate of 1.8%.

The nation’s monetary and financial conditions are poised to continue supporting the financing needs, driven by domestic growth and prospects for increased income. Despite the external risks, Malaysia’s financial markets are anticipated to maintain resilience, ensuring orderly conditions in the marketplace.