CIMB Revises 2H 2026 GDP Forecast To 4.1 Pct, Raises 2026 GDP Projection To 4.8 Pct

KUALA LUMPUR, July 18 (Bernama) -- CIMB Treasury and Markets Research has revised its second-half 2026 (2H 2026) gross domestic product (GDP) forecast to 4.1 per cent and raised its full-year 2026 projection to 4.8 per cent from 4.3 per cent, tracking a stronger outturn in the second quarter (2Q) of 2026.

The research house said the revision was driven primarily by the electrical and electronics (E&E) manufacturing outlook, which it now expects to expand 15.4 per cent year-on-year (y-o-y) in 2026. 

"Even so, we continue to expect overall growth to moderate to 4.1 per cent in 2H 2026 (1H 2026: 5.6 per cent) as softer domestic demand and weaker domestic-oriented manufacturing offset continued strength in export-oriented E&E," it said in a note today. 

CIMB Treasury and Markets Research also projected overall manufacturing growth to ease to 6.1 per cent in 2H 2026, compared with 6.6 per cent in 1H 2026, while services growth is similarly expected to moderate to 4.2 per cent, from 5.5 per cent in the same period.

"The slowdown in services partly reflects less favourable base effects following last year's strong performance. 

"Nevertheless, sequential growth is expected to remain broadly consistent with historical trends, although higher inflation is also likely to weigh on household spending towards year-end," it said. 

Meanwhile, the research house said it still expects headline inflation to average 2.6 per cent in 4Q 2026, with the anticipated increase remaining primarily driven by cost-push factors.

"Underlying price pressures are also expected to remain contained, with core inflation stable at around 2.2–2.3 per cent. 

"In the absence of meaningful second-round effects, we expect Bank Negara Malaysia to continue looking through this temporary supply-driven inflation," it added. 

-- BERNAMA