MONEY MASTER

Malaysia is entering 2026 with  solid economic visibility , backed by stable monetary policy, resilient domestic demand, and continued strength in the technology and semiconductor space. According to Maybank Investment Bank,  Malaysia’s GDP is expected to grow between 4.3% and 4.5% in 2026 , even as global growth moderates to around 2.8%. This resilience is driven by  strong investment activity, AI-related capex, and healthy MSME contributions , which continue to support employment and productivity. On the policy front,  Overnight Policy Rate (OPR) is expected to remain unchanged at 2.75% , providing a supportive environment for consumption and business expansion. While manufacturing faces tariff-related pressures, the  services sector continues to act as a key buffer  for overall growth. The  ringgit outlook is improving , supported by Malaysia’s strategic position in the global semiconductor supply chain. The currency is forecast to trade around...

Malaysia’s upcoming  Budget 2026  (to be tabled on  Oct 10 ) is expected to mark a strategic shift — from  post-pandemic recovery  to  long-term structural reform  and  fiscal consolidation . While  Budget 2025  emphasized tourism revival and domestic consumption,  Budget 2026  aims to  sustain growth, improve fiscal health, and accelerate green and digital transformation  under the  13th Malaysia Plan (13MP) . Macroeconomic Outlook Leading institutions  UOB ,  OCBC , and  CIMB Securities  broadly agree that: Fiscal deficit  is likely to narrow to  3.4–3.6% of GDP , driven by improved tax compliance and the upcoming  carbon tax . Development expenditure  will remain steady at around  RM86 billion , aligned with infrastructure priorities. GDP growth  forecasts range between  3.8% (OCBC)  and  5.5% (UOB) . Inflation  is projected to ease, allowin...

  Key Takeaways • Malaysia’s August PMI rose to 49.9, its highest in 14 months, but still below the 50.0 expansion threshold. • Analysts warn the August rebound may partly reflect temporary front-loading ahead of the 19% US tariff hike effective Aug 1. • September PMI will provide the first clear picture of how tariffs are affecting manufacturing momentum. • Domestic demand, trade diversification, and “China+1” investments offer buffers, but external risks remain high. August Performance S&P Global reported Malaysia’s manufacturing PMI at 49.9 in August, up from 49.7 in July, marking the strongest reading since June 2024. The improvement was driven by renewed increases in new orders, although business confidence weakened and employment growth moderated. Tariff Effects and Outlook BIMB Securities noted that August strength may reflect front-loaded activity before the US tariff hike took effect on Aug 1. This raises the likelihood of softer performance in the second half of 2025 ...

After a strong start to 2025, Malaysia's economic engine is losing steam — and fast. The early-year surge? Fueled by frontloaded exports to the US. But with new  tariffs kicking in on August 1 , the momentum is fading. Now, economists are sounding the alarm:  2H25 could be a lot bumpier than expected. Export Rush = Temporary Boost OCBC’s Lavanya Venkateswaran revealed that Malaysia frontloaded a whopping  US$2.5B/month in exports  between Oct 2024 and May 2025 — mainly electronics and electrical goods headed to the US. Bank Muamalat’s Dr. Afzanizam added that  exports to the US surged 33%  in the first five months. That pushed  1H25 GDP growth to an estimated 4.5% , but the boost was always meant to beat the tariff clock. 💬  “This growth isn’t sustainable — it’s just timing,”  said economist Geoffrey Williams. What’s Coming in 2H25? With frontloading done, the export wave is crashing. OCBC slashed its  2025 GDP forecast from 4.3% to 3.9...

  Key Takeaways: Potential Risks from U.S. Tariffs : Analysts have raised concerns over the upcoming "Liberation Day" tariffs set to be announced on April 2 by U.S. President Donald Trump. These tariffs, which are expected to impact several countries, could slow global trade and negatively affect Malaysia’s export performance. The prospect of more restrictive trade measures and retaliatory actions, along with rising geopolitical tensions, pose key risks to the Malaysian economy in 2025. BNM’s Optimistic Outlook : Bank Negara Malaysia (BNM) has projected Malaysia’s economic growth to be between 4.5% and 5.5% in 2025, with inflation expected to range between 2% and 3.5%. However, these projections do not account for the new tariffs, raising concerns about how these measures might impact growth, especially as Malaysia is still recovering from global trade disruptions. Trade Diversification Provides Buffer : Despite these risks, analysts noted Malaysia's increasing trade dive...

Rakuten Trade Sdn Bhd anticipates the benchmark FBM KLCI testing the 1,730-point level by year end. This optimism is driven by foreign direct investment (FDI) in data centers, improved corporate earnings, and increased domestic liquidity. Key Drivers: FDI and Domestic Investment: Approximately RM80 billion in data center-related FDI supports Malaysia’s marketing efforts. Additionally, the government's directive for government-linked investment companies (GLICs) to reduce overseas investments and focus on the domestic market could bring RM20 billion to RM30 billion back into the local market. Improved Trading Volume: Recent improvements in trading volume, with the year-to-date average daily volume surpassing the 10-year average, indicate potential positive developments in the local stock market. Corporate Earnings: Projected Growth: Rakuten projects a 16.1% growth in corporate earnings for the year. Sector Performance: Banking: Top picks include RHB Bank Bhd, Malayan Banking Bhd...