KUALA LUMPUR: CIMB Treasury and Market Research has revised its 2025 gross domestic product (GDP) growth forecast for Malaysia upwards to 4.3 per cent from 4.0 per cent previously, premised on easing trade tensions and indications of constructive United States-Malaysia dialogue.
In a note, it said that although this represents an improvement, it still falls short of the government’s 4.5-5.5 per cent target, reflecting a more cautious view on the recovery in external demand and domestic momentum.
"Along with benign inflation (Jan-April 2025: 1.5 per cent year-on-year), this allows Bank Negara Malaysia (BNM) room to cut the overnight policy rate (OPR) to 2.75 per cent in the third quarter of 2025,” it said.
Meanwhile, Kenanga Investment Bank Bhd
(Kenanga IB) is maintaining its 2025 GDP growth forecast for Malaysia at 4.3 per cent, as domestic demand and the services sector are expected to stay resilient despite global economic uncertainty.
However, it said persistent weakness in the commodity-related sector will continue to weigh on growth momentum.
On export, the investment bank noted that exports grew 5.5 per cent in the first five months of this year, ahead of the full-year forecast.
"Although May’s export data was underwhelming, we expect the dip to be short-lived with a likely rebound in June. However, growth is expected to remain volatile in the near term due to the July reciprocal tariff deadline,” it said.
Nevertheless, Kenanga IB see continued support from the global tech upcycle, driven by artificial intelligence-related demand, new product launches, and Malaysia’s export diversification. - Bernama
