Bank Negara governor Datuk Seri Abdul Rasheed Ghaffour.
KUALA LUMPUR: Malaysia’s gross domestic product (GDP) growth forecast for 2025, currently projected at between 4.5% and 5.5%, may need to be revised downward due to the impact of tariffs, says Bank Negara.
However, the central bank is not rushing to adjust the forecast, as the situation is still developing, said Bank Negara governor Datuk Seri Abdul Rasheed Ghaffour.
“Certainly, this (Malaysia’s growth) will need to be marked out. But we are not in a rush to do it because we need to see how it (the reciprocal tariffs) unfolds.
“For example, it depends on how the negotiations and potential retaliatory measures play out,” he said at the International Monetary Fund (IMF) Annual and Spring Meetings in Washington on Wednesday.
He was one of the distinguished speakers at the forum titled “Governor Talks – The Future Ahead: Malaysia and Asean in a Changing Landscape”.
The central bank governor acknowledged that while Bank Negara had factored in some downside risks in its latest economic projections released in March, the developments following Donald Trump’s announcement were entirely unexpected.
“We just came out with our annual report last month, and, at that point, we have taken into account some assumptions (which) we believe were rather conservative. But what came up was even different, surprising, not just in Malaysia but I believe the whole world,” he added.
On April 2, 2025, the US president announced a series of reciprocal tariffs affecting countries across the board, including a 24% tariff on Malaysian goods, which is currently paused.
The IMF has downgraded Malaysia’s real GDP growth forecast for 2025 to 4.1% from 4.7%, reflecting a broader downward revision across the region.
Despite external headwinds, Abdul Rasheed emphasised that Malaysia is entering 2025 from a position of strength underpinned by solid domestic fundamentals.
“We started with a strong growth last year, at 5.1%, surpassing our earlier projections. This was primarily driven by robust domestic demand, increased investment, and strong goods exports.
“But again, I think this is something that we will be monitoring closely, and we are vigilant in terms of the financial impact that is coming on board. We will react accordingly,” he emphasised. — Bernama
