MIDF Forecasts 4.6 Pct Growth For Malaysia In 2025

KUALA LUMPUR, Jan 17 (Bernama) -- Malaysia’s economy is expected to grow at a pace of 4.6 per cent this year, driven by increased domestic spending and investment, alongside continued expansion in external trade, according to MIDF Amanah Investment Bank Bhd.

In a research note, the bank said that stronger domestic growth would help Malaysia’s economy navigate external uncertainties, such as ongoing geopolitical tensions, trade disputes, and protectionist policies, which could dampen the international trade outlook.

"On the domestic front, we are closely monitoring potential inflationary effects from policy changes, as weaker purchasing power could affect prospects for discretionary spending," MIDF said.

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The bank noted that Malaysia’s economic growth moderated to 4.8 per cent year-on-year (y-o-y) in the fourth quarter of 2024 (4Q 2024), down from 5.3 per cent y-o-y in 3Q 2024, after two quarters of growth above 5 per cent.

MIDF also referenced the Department of Statistics Malaysia (DOSM)’s advance estimate for 2024 full-year GDP growth at 5.1 per cent, up from 3.6 per cent in 2023, slightly above its 5 per cent forecast.

"The manufacturing sector continued its growth momentum but moderated to 4.3 per cent y-o-y, compared to 5.6 per cent y-o-y in 3Q 2024, in line with export performance and the pick-up in export-oriented sectors such as electrical and electronics, chemicals, wood products, machinery and equipment, and petroleum products."

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"The construction sector also continued to grow robustly, albeit moderating slightly to 19.6 per cent y-o-y (3Q 2024: 19.9 per cent y-o-y), indicating encouraging progress in development and construction projects," it added.

MIDF also noted that the services sector grew by 5.3 per cent y-o-y in 4Q 2024 (3Q 2024: 5.2 per cent y-o-y), continuing its upward trend since 4Q 2021, driven by rising domestic spending.

-- BERNAMA