Key View

• While policymaking in Malaysia has been relatively unencumbered since the Anwar-led government took over in November 2022, we continue to anticipate challenges to policymaking in the near-term.
• Competing political priorities among component parties and the upcoming state elections will slow reform momentum in Malaysia.
• As such, we

Key View

• We have revised up our forecast for Malaysia’s real GDP growth to 4.2% in 2023 from 4.0% previously, accounting for the better-than-expected 5.6% y-o-y expansion in Q123.
• That said, our forecasts still imply that growth will slow over the coming quarters, which we think will be driven by a slowdown in global demand and tighter credit

Key View: We hold a positive outlook for consumer spending in Malaysia over 2023. While both the wider economy and the consumer sector will see a slowdown in growth over the year, easing inflation, lower unemployment and manageable household debt levels will support spending growth across several consumer spending segments over the year. Risks to

Key View

• We at Fitch Solutions maintain our Short-Term Political Risk Index score for Malaysia at 72.9 (out of 100).
• While risks to policy continuity have diminished following the smooth transition to the Pakatan Harapan-led coalition government, we continue to anticipate challenges to policymaking.
• The unity government comprises multiple

Key View

• At Fitch Solutions, we now expect Bank Negara Malaysia to hike its Overnight Policy Rate by 25bps to 3.00% at its next meeting in May, before standing pat for the rest of the year (as compared with an additional 25bps hike previously).
• Above-target inflation, negative real interest rates, and ringgit volatility will likely prompt

Key View

• Malaysia’s digital health sector is progressing as the industry targets international collaborations to expand its capabilities.
• Electronic healthcare records and big data will continue to see positive growth outlook, supported by concerted efforts to advance both technologies.
• Efforts to digitise healthcare along with

Key View

• Although Bank Negara Malaysia unexpectedly kept interest rates on hold at its meeting on January 19 2023, we at Fitch Solutions maintain our forecast that the Overnight Policy Rate will be hiked to a terminal rate of 3.25% over the coming months.
• Core inflation remains on a firm uptrend, and we expect that headline inflation will

Key View

• We expect Malaysia’s banking system to remain stable over the coming quarters as the banking sector boasts robust capital and liquidity buffers.
• However, we believe that the outlook for banks will likely deteriorate in 2023, amid a higher interest rate and slower growth environment.
• Non-performing loans will likely increase over the