KUALA LUMPUR – Malaysia’s economy is projected to expand between 4.5% and 5.5% in 2025, according to the latest forecast by Bank Negara Malaysia (BNM). This outlook, announced by BNM Governor Abdul Rasheed Ghaffour in a press briefing in Kuala Lumpur on Tuesday, is based on the country’s current economic momentum and various external and domestic factors.
Governor Abdul Rasheed highlighted that sustained domestic demand will be the primary driver of economic growth, even as global uncertainties continue to pose challenges to Malaysia’s export sector. While the global trade environment remains uncertain due to ongoing geopolitical tensions and trade disputes, the Malaysian economy is expected to remain resilient, supported by strong consumer spending and robust private sector investment.
The central bank’s projection takes into account several key economic variables, including national income levels, energy prices, and global trade conditions. Despite external risks, policymakers are optimistic that Malaysia will maintain steady economic progress through a combination of strategic fiscal measures and proactive monetary policies.
Global trade uncertainties have been a significant concern, with rising tariff disputes and geopolitical developments adding to market volatility. Governor Abdul Rasheed acknowledged that these factors could lead to fluctuations in Malaysia’s export performance, making external demand a less predictable contributor to growth. However, he also emphasized that BNM has factored in both downside and upside risks in its growth projections, including the possibility of trade conflicts de-escalating or intensifying.
Inflation is expected to remain manageable, with headline inflation forecasted to range between 2.0% and 3.5% in 2025. This projection accounts for potential price pressures arising from domestic policy adjustments, though the central bank believes inflationary risks will be mitigated by stable global cost conditions and the absence of excessive domestic demand pressures.
The Malaysian economy demonstrated strong performance in 2024, recording a solid growth rate of 5.1% while maintaining a stable inflation rate of 1.8%. Economic expansion was observed across all key sectors, driven by resilient private consumption, strong investment activity, and a gradual recovery in exports. These positive trends have laid a solid foundation for continued growth in 2025.
BNM remains committed to ensuring macroeconomic stability and supporting Malaysia’s economic resilience in the face of global uncertainties. As the country moves into 2025, the central bank is expected to closely monitor both domestic and international developments to implement policies that sustain growth while maintaining financial stability.
