KUALA LUMPUR, May 19 — Malaysia is entering the current oil crisis from a position of strength, with its economic growth forecast maintained at 4.5 per cent for 2026, said the Standard Chartered Bank (SCB).
The nation recorded a gross domestic product (GDP) growth of 5.4 per cent year-on-year in the first quarter of 2026 (1Q 2026).
“While sequential growth was flat, we highlight that GDP had risen consecutively for the previous 12 quarters. Services exports and private investment were strong in the first quarter,” it said in a research note today.
SCB added that it expects consumer spending to stay resilient going forward, supported by sustained wage growth, income-related policy measures, and cash transfers.
Similarly, the BUDI95 fuel subsidy should help cushion households from higher oil prices and limit the drag on consumption.
Household consumption remained stable in 1Q 2026, adding 2.9 percentage points to year-on-year GDP growth, albeit down from 3.2 percentage points in 4Q 2025.
Consumer spending remained slightly lacklustre relative to the 2017-2019 average, contributing 4.2 percentage points to year-on-year GDP growth.
Meanwhile, it said risks of a rate hike in Malaysia have increased as Bank Negara Malaysia’s focus appears to be shifting towards inflation amid broadening price pressures.
SCB noted subtle changes in its policy statement, including a shift in the characterisation of the monetary policy stance from “appropriate and consistent” to “appropriate and supportive”, suggesting a move away from neutrality.
The overall first-quarter balance of payments position was strong at 3.2 per cent of the GDP, which remains positive for the ringgit.
