Financial Flash│By Lee, Chen-Lin（Daniel Lee）李振麟
Malaysia’s overall economic outlook continues to show resilience despite global uncertainties. According to a new report from Apex Securities, the country’s manufacturing sector is supported by the ongoing recovery in the technology cycle, firm semiconductor demand, and solid domestic consumption. The rising wave of AI-related investments is expected to further boost the electrical and electronics (E&E) sector, helping strengthen external demand.
Recent developments—including the signing of a U.S.–Malaysia reciprocal trade agreement and easing U.S.–China trade tensions—also suggest a more favorable trade environment ahead.
However, Apex Securities cautioned that the existing 19% U.S. tariff on Malaysian goods remains a major headwind for export-oriented manufacturers, especially those in the technology and semiconductor supply chain.
Central Bank Expected to Keep Policy Rate Unchanged Through 2026
BMI, a unit of Fitch Solutions, reported that Bank Negara Malaysia (BNM) is likely to maintain its Overnight Policy Rate (OPR) at 2.75% until the end of 2026. The analysis cites low inflation risk and steady global commodity prices as key factors.
Malaysia’s inflation rate is projected to remain stable at 1.7% in 2026, while economic growth may ease slightly—from an estimated 4.2% in 2025 to 4.1% in 2026. BMI noted that risks to its outlook are broadly balanced: stronger-than-expected growth in major economies and continued AI investment could lift exports, while the fading effect of earlier front-loading of shipments could temporarily weigh on export momentum.
Apex Securities added that, barring new tariff shocks or major trade disruptions, BNM has little need to adjust its policy stance before 2026. Semiconductor-related tariffs remain the main uncertainty, but recent improvements in trade relations reduce the urgency for further easing.
Ringgit Strengthens as Market Confidence Improves
The Malaysian ringgit has strengthened against the U.S. dollar as investors gain confidence in the country’s growth prospects.
According to MUFG senior currency analyst Chang Chen, the ringgit is supported by:
resilient domestic demand
improving E&E exports
a strong rebound in tourism
stable inflation and steady interest rates
MUFG expects the ringgit to appreciate further through 2025, partly due to a narrowing interest rate gap between Malaysia and the United States.
FactSet data shows the USD/MYR pair fell 0.2% to 4.1730, after briefly touching 4.1719, the lowest intraday level since early October 2024.
Outlook: Positive Momentum but Tariff Risks Remain
Overall, Malaysia’s medium-term economic outlook remains stable, supported by the technology cycle recovery, solid domestic consumption, and steady monetary policy. The strengthening ringgit also reflects improving market sentiment.
However, U.S. tariff policies—especially those involving the semiconductor sector—remain the key risk to Malaysia’s export performance in the coming years.
馬來西亞經濟展望保持穩健，製造業受半導體需求與內需支撐。分析預期馬來西亞央行將至 2026 年維持利率不變。林吉特兌美元走強，反映市場對成長前景的信心。關稅仍是出口風險。