Putrajaya, Malaysia, 28 July 2026 – Malaysia needs renewed reform momentum to protect fiscal sustainability, raise productivity and strengthen education outcomes as external risks test an economy approaching high-income status, according to a new international economic assessment.
The review projects gross domestic product growth of 4.9% in 2026 and 5.0% in 2027 after expansion of 5.2% in 2025. Inflation is expected to rise from 1.4% last year to 2.1% in 2026 and 2.3% in 2027, while trade tensions, higher commodity prices and weaker global demand remain important downside risks.
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