KUALA LUMPUR, Oct. 7 (Xinhua) -- The World Bank has forecast Malaysia's economy to grow 4.1 percent year-on-year in 2026.
Its lead economist for Malaysia Apurva Sanghi told a press conference on Tuesday that the growth of the Malaysian economy is expected to continue moderating in 2026, as external headwinds are likely to persist.
While global demand is projected to improve slightly, the World Bank notes that regional growth is anticipated to slow. Export growth for Malaysia is likely to be subdued as front-loading effects unwind, with the impact of prospective tariff measures on the semiconductor sector remaining uncertain.
Meanwhile, domestic demand is expected to remain the main driver of growth. Private consumption will be supported by continued wage growth, alongside government measures such as the second phase of the civil service salary increase in January 2026.
Malaysia's economy expanded by 4.4 percent in the first half of 2025, supported by resilient domestic demand, particularly household consumption and investment.
Growth is projected at 4.1 percent for 2025, moderating from 5.1 percent in 2024, but slightly higher than earlier forecasts, according to the World Bank. ■
