Kuala lumpur: Malaysia’s gross domestic product (GDP) is expected to expand by 4.6 per cent in 2026, supported by improving external demand despite a slight moderation in domestic activity, said CGS International Securities Malaysia Sdn Bhd.

According to BERNAMA News Agency, the research house indicated that after a brief United States-China trade truce, external demand may improve further, reducing supply chain disruptions and sustaining Malaysia’s GDP growth. CGS International acknowledged that the positive but modest outlook for 2026 is tempered by several risks on the horizon.

The US reciprocal tariff, after a year of deliberations, is slated to take effect next year, posing risks to supply chains. Similarly, the anticipated US sectoral tariff may impact the global economy significantly. Moreover, China continues to face subdued economic momentum, as its weakening property market remains unstable.

Further risks are emerging in financial markets, including technology stock repricing and yen carry-trade unwinding, potentially impacting the real economy. Combined, these threats could set the stage for volatility and a prolonged period of economic weakness.

For Indonesia, CGS International has raised its 2026 growth forecast to 5.1 per cent, expecting a recovery supported by proactive government stimulus. In contrast, Singapore’s GDP is anticipated to expand by 2.8 per cent in 2026, influenced by softer growth among key trading partners. Thailand is projected to see a mild growth of 1.9 per cent in 2026, with major investments likely delayed until after the general election in the latter half of the year.