KUALA LUMPUR, March 31 (Xinhua) -- The Malaysian economy is projected to grow between 4 percent and 5 percent in 2026 amid the challenging and uncertain global landscape, its central bank said Tuesday.
The Bank Negara Malaysia (BNM) said in a statement that Malaysia is entering this challenging period from a position of strength, supported by robust domestic demand, moderate inflation, a sound financial sector, and a resilient external position.
It also said BNM will remain vigilant against the rapidly evolving Middle East conflict.
"There are key risks to the growth outlook that we must continue to monitor, assess and manage. Downside risks are mainly external in nature, arising from slower global trade due to the Middle East conflict and tariffs, alongside lower commodity output," its governor Abdul Rasheed Ghaffour said.
On the Middle East conflict, he said the situation is highly fluid. He noted the developments on this front change by the day, and the effects on the world and Malaysia will depend on the length and the severity of the conflict.
"There is, however, some upside potential that could arise from better global growth, stronger electrical and electronics (E&E) demand and more robust tourism," he added.
He also said the Malaysian economy is resilient, recording growth of 5.2 percent in 2025 despite an extremely challenging external environment.
Stable domestic economic, monetary and financial conditions have helped cushion the impact of external shocks and paved the way for important reforms to take place, he said.
"We must continue to strengthen our economic fundamentals and policy buffers to better position Malaysia to navigate prevailing and future headwinds," he said. ■