KUALA LUMPUR, May 20 (Xinhua) -- Economists have lowered Malaysia's full-year economic growth forecast amid the uncertainties of U.S. trade tariffs.
Maybank Investment Bank said in a note on Monday that it has trimmed Malaysia's 2025 real gross domestic product (GDP) growth to 4.1 percent from 4.3 percent as first-quarter growth was below its estimate, plus the expected further deceleration in second-quarter growth on a high base effect last year.
The research house also noted the impact of the spiking uncertainties and volatility amid the twists and turns in U.S. tariffs, including the impact on manufacturing and exports after the front-loading ahead of U.S. tariff deadlines.
Meanwhile, MIDF Research said in a note last Friday that it forecasts Malaysia's GDP to grow at a more moderate pace of 4 percent this year, where domestic demand will be the key contributor to growth, mitigating the effect of the slowdown in external trade.
"Steady employment and wage growth, particularly in domestic-oriented sectors, along with income-related policy support, are expected to help sustain household spending," said the research house.
On the tourism front, MIDF believes stronger activity will bolster Malaysia's growth prospects and drive higher tourist expenditure.
While recent developments suggest a de-escalation in trade tensions, it remains cautious, as lingering uncertainties from the global trade war and potential disruptions to global supply chains continue to pose downside risks to Malaysia's economic outlook.
ANZ Research also expects Malaysia's growth to ease to 4.1 percent in 2025 amid heightened global policy uncertainty.
"External demand is expected to soften due to slower global growth," said the research house.
Moreover, the uncertain outcome of the ongoing trade negotiations is also expected to impede the realization of strong investment approvals recorded in 2024.
"Furthermore, private consumption is also likely to wane in the coming quarters as rising uncertainty and falling consumer confidence will weigh on consumption demand," it added. ■
