Qualampur: RHB Investment Bank BHD (RHB IB) has maintained the forecast of its 2025 Gross domestic product (GDP) at 4.5 per cent year-on-year (YOY), despite Malaysia’s first quarter 2025 (1q 2025) GDP growth data is slightly lower than 4.4 per cent.
The investment bank today stated in a note that the negative risk of development slows down by 3.5–4.0 percent, thanks to the recent progress in the US-China trade talks.
“However, we take precautions against premature optimism-the risk may occur even after July 8, when the deadline of the initial 90-day adjournment of the tariff ends.
“Thus, so far, the discount from tariffs has been limited to China and the UK, with very little information about other areas,” it said.
The investment bank stated that despite a vigilant approach on external developments, many factors expect to support Malaysia’s economy, which have grown amidst external uncertainties.
“Domestic demand, in particular, is estimated to be possible from these external challenges as the domestic economy has demonstrated flexibility, which is powered by strong consumer expenses and stable investment.
“Strategic initiative within Madani Economy Framework, including National Energy In
Meanwhile, senior ASEAN economist Lavanya Venkateavaran, Senior OCBC, said that he expects 5.1 percent vs. 4.3 percent yoy in 2025 in 2025 to slow down to 4.3 percent yoy, the current account surplus is likely to be 1.7 percent of GDP in 2025.
“Under such circumstances, counter-cyclic policy measures will be adopted, including possible changes in the government’s Ron95 rationalization agenda, targeted support (already started) and additional tax relief for small and medium enterprises.
“For its share, Bank Negara Malaysia (BNM) made a sound of more davish in its 8 May meeting, which exposed to increase the increased uncertainties and negative risks, and reduced the statutory reserved requirement to two percent to one percent, effectively, on 16 May, the system released RM19 billion in the system.
Lavanya said that further action from BNM boils the level of uncertainty in the reaction function of BNM.
“Now we bring forward our call from 1h 2026 in the second half of 2025 (2H 2025) by cumulative 50 basis points for BNM to cut our calls forward, which can lead to the place for BNM.
He said, “We will determine the exact time to cut the rate based on the economic data coming in the meetings of July 9, Sept 4 and November 6 and tariff dialogue results with the US.”
