Malaysia Raises Growth Outlook, Sees War Impact Contained

Malaysia lifted its economic growth forecast for 2026, expecting strong domestic demand and investment to cushion the impact of the escalating war in the Middle East.

The economy is seen expanding between 4% and 5% this year, Bank Negara Malaysia said in its annual economic and monetary review released on Tuesday. That compares with the government’s forecast of 4% to 4.5% that was set in October. The central bank’s forecast reflects more recent developments, including the fallout from the Iran war.