Malaysia's economy strengthens to 6.0% in second quarter

Malaysia's economy demonstrated robust growth, expanding by 6.0% in the second quarter of 2026. This performance significantly outpaced the 5.4% growth seen in the preceding quarter and the 4.4% recorded in the second quarter of the previous year. The expansion was primarily fueled by persistent domestic demand and strong export performance.

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Growth in investment was supported by continued spending on structures, machinery, and equipment.

Household spending, a key driver of the economy, was bolstered by stable income growth. Government policies also played a crucial role in supporting this economic momentum. Investment growth was also notable, supported by ongoing capital expenditure on structures, machinery, and equipment.

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The overall inflation increase largely reflects higher external cost pressures following the conflict in West Asia.

On the external front, exports saw rapid growth, largely due to sustained demand for electrical and electronic (E&E) products. The services sector also continued its expansion, complemented by a recovery in liquefied natural gas and non-E&E manufactured goods exports. Imports also increased, reflecting strong growth in intermediate and consumer goods.

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This achievement proves that the government's reforms under the Ekonomi Madani framework have helped reduce the impact of global supply disruptions on the people.

Despite global economic headwinds, including supply chain disruptions and the conflict in West Asia, Malaysia's economy has shown resilience. Overall inflation rose slightly to 1.9% from 1.6% in the first quarter, influenced by higher fuel costs. However, core inflation saw a decrease to 1.9% from 2.1% in the previous quarter. Prime Minister Anwar Ibrahim attributed the strong performance to the government's "Ekonomi Madani" reforms, which have helped mitigate the impact of global disruptions and protect citizens and businesses through targeted subsidies and support for small and medium-sized enterprises.

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These efforts have helped maintain household spending, stimulate business activities, and sustain growth momentum in the second quarter of 2026.