Malaysia's Q3 growth to slow as consumers stay cautious despite export surge
Malaysia's economy is projected to grow about 5% in the July-September quarter, a slowdown from earlier months as household spending remains wary amid rising costs.
Malaysia is forecast to record around 5% GDP growth in the July-September period, a deceleration from the 6% expansion seen in the previous quarter. The slowdown reflects cautious consumer behaviour as living costs climb, even though export volumes surged, led by a 66.5% jump in electrical and electronics shipments tied to global semiconductor and AI demand. Investment in machinery, ICT and data centres is also supporting activity.
The producer price index climbed 10.7% in August, suggesting potential price pass-through to buyers. While the trade surplus widened, imports of intermediate and capital goods rose sharply, and the deficit with China grew, highlighting Malaysia's role in regional supply chains. Analysts warn that external risks such as US semiconductor tariffs and Middle-East tensions could affect the outlook.
Why it matters
The outlook signals how Malaysia's export-driven growth may be tempered by domestic cost pressures and global trade risks.
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