KUALA LUMPUR, April 24 — RHB Investment Bank Bhd (RHB IB) has raised its forecast for Malaysia's gross domestic product (GDP) growth in the first quarter of 2026 (1Q 2026) to 5.2 per cent from 5.0 per cent ahead of the final release on May 15, 2026.
The investment bank said the growth will be supported by resilient domestic demand and electrical and electronics (E&E) exports.
“While this is not our base case, 2026 GDP growth could ease to around 4.0 per cent if the elevated oil prices persist through the third quarter of 2026 (3Q 2026), alongside supply chain disruptions.
“Malaysia’s 1Q 2026 advance GDP grew by 5.3 per cent year-on-year (y-o-y), surpassing our in-house estimate of 5.0 per cent but coming in below the consensus forecast of 5.5 per cent,” it said in a note today.
Separately, March’s Consumer Price Index (CPI) inflation came in at 1.7 y-o-y, in line with its in-house projection and Bloomberg’s consensus estimates.
RHB IB also noted that it has maintained its 2026 headline inflation forecast at 1.8 per cent while remaining mindful of potential cost-push pressures.
Escalating geopolitical tensions are pushing up global energy prices, with potential pass-through to inflation if crude oil prices remain elevated.
It explained that while this is not the base case, headline inflation could rise to around 3.2 per cent if oil prices surge to US$140 per barrel amid prolonged geopolitical tensions.
“This is based on our empirical findings that a one per cent increase in Brent crude prices would lift the CPI by approximately 0.01 percentage points in the current month and 0.02 percentage points in the following month.
“However, subsidies may help cushion the impact, with overall effects depending on the duration of the oil price surge,” RHB IB said.
