Kuala lumpur: Despite the energy supply shock, Malaysia's economy is projected to grow by four to five percent, likely reaching the upper end of this range with manageable inflation in 2026, according to Bank Negara Malaysia (BNM) Governor Datuk Seri Abdul Rasheed Ghaffour.
According to BERNAMA News Agency, Abdul Rasheed emphasized that Malaysia's strong economic fundamentals, reform agenda, and commitment to sound economic management have enabled the government to effectively respond to shocks. He highlighted the role of BNM in preserving macroeconomic stability, which has facilitated economic reforms. The governor noted that low and stable inflation, along with a sound financial system and orderly markets, have created favorable conditions for economic transformation.
In his keynote address at the Sasana Symposium 2026, themed "Reforms for Resilience: Navigating Uncertainties," Abdul Rasheed discussed key economic and financial issues. He pointed out that in the previous year, Malaysia's economy expanded by 5.2 percent, with contained inflation and a strong-performing ringgit.
The governor also addressed Malaysia's fiscal position, noting a reduction in the fiscal deficit to 3.7 percent of GDP in 2025 from 6.2 percent in 2020, thus rebuilding policy space amid increasing public resource demands. As Malaysia progresses, Abdul Rasheed stressed the need for the financial system to evolve, guided by values and responsibility, and announced BNM's Financial Sector Blueprint 2027-2030, focusing on resilience, prosperity, and future-proofing the financial system.
Abdul Rasheed also highlighted the importance of sustainable economic growth, recognizing Malaysia as one of the world's most biodiverse nations. He mentioned that sustainable public finances are crucial for national policies, impacting education, healthcare, infrastructure, climate resilience, and social protection.
Looking forward, he expressed confidence in Malaysia's medium-term outlook, anticipating firm growth and manageable inflation while maintaining price stability to support sustainable economic development.