- GLOBAL ECONOMY CONTINUES TO STRENGTHEN
- BALANCED RISKS TO GLOBAL OUTLOOK
- MALAYSIA: STRONG GROWTH OPTIMISM
- ECONOMIC & FINANCIAL ISSUES
Global UPSWING to continue in 2018
- SYNCHRONOUS GLOBAL UPTREND IS BROADENING. Global economic growth is BROADLY BASED and SUSTAINED in 2018, driven by private consumption and investment
- GLOBAL TRADE is showing strong growth momentum
- In ADVANCED ECONOMIES, RISING WAGES and POLICY SUPPORT will provide further impetus to growth
- In ASIA, growth will be driven by SUSTAINED DOMESTIC ACTIVITY and strong EXTERNAL DEMAND
- Supported by stronger global economic conditions, Bank Negara Malaysia expects the MALAYSIAN ECONOMY to grow by 5.5% - 6.0% (mid-point at 5.7%) in 2018 (5.9% in 2017). This is higher than our revised estimate of 5.5%.
- DOMESTIC DEMAND will continue to be the anchor of growth, underpinned by private sector activity. Both private consumption and investment are expected to grow at healthy clip in 2018, backed by supportive Budget measures, investment and growth-enhancing initiatives.
- ALL ECONOMIC SECTORS are forecasted to expand in 2018. The services and manufacturing sectors will continue to be the key drivers of overall growth.
- HEADLINE INFLATION is projected to moderate in 2018, averaging between 2.0% – 3.0% (3.7% in 2017), due mainly to an expected smaller price pressures from global energy and commodity prices. A stronger ringgit exchange rate would also mitigate import costs.
- OVERALL ECONOMIC OUTLOOK could see UPSIDE RISKS coming from stronger than expected global growth, which bodes well for exports, investment and income of export-oriented industries, including the expansion of production capacities of some industries. The DOWNSIDE RISKS are rising trade tensions among major trading nations; abrupt shifts in global monetary and regulatory policies; sharp corrections in financial markets would weigh on confidence and economic activity.