Kuala lumpur: MBSB Investment Bank Bhd has maintained its projection for Malaysia’s Industrial Production Index (IPI) growth to moderate to around 2.0 per cent this year, compared to 3.7 per cent last year.

According to BERNAMA News Agency, the projection was due to the possible impact of higher tariffs on external trade and the production of export products. The bank noted that earlier front-loading activities, an increase in re-exports, and sustained domestic demand would keep IPI growth in positive territory. On the domestic front, increased domestic spending and local business activities are expected to drive the production of domestic-oriented goods.

The investment bank also highlighted that local producers and exporters should closely monitor the risk of slower external demand, particularly from major markets such as the United States and China. This slowdown could affect their production activities and hiring decisions.

Earlier reports from the Department of Statistics Malaysia (DoSM) indicated that Malaysia’s IPI growth slowed to 4.2 per cent year-on-year in July 2025, down from 5.8 per cent in July 2024. However, this performance was still higher compared to the 2.9 per cent recorded in June of the same year.