Malaysia’s economy expanded 6% in the second quarter of 2026 (2Q26), accelerating from 5.4% in the preceding quarter, as resilient domestic demand, robust exports and artificial intelligence-driven technology investments strengthened growth, Bank Negara Malaysia (BNM) Governor Datuk Seri Abdul Rasheed Ghaffour said.
Abdul Rasheed explained that the stronger performance was supported by steady household spending, continued investment in structures and machinery, and a sharp expansion in exports, particularly electrical and electronics (E&E) products.
“On a quarter-on-quarter seasonally adjusted basis, the economy grew 2.5%, rebounding from a marginal 0.03% contraction in the first quarter.
“Overall, Malaysia’s economy remains on a firm footing despite persistent external uncertainties, with full-year growth expected to remain within BNM’s 4% to 5% forecast range,” he said during the press conference on the 2Q26 GDP on Aug 14.
He also emphasised that recent developments indicate that overall growth could be around 5% and Malaysia remains well-positioned to navigate global challenges backed by strong economic fundamentals and policy readiness.
Meanwhile, Abdul Rasheed shared that export growth in 2Q26 was driven by continued strength in E&E products, expanding services exports and a rebound in liquefied natural gas and non-E&E manufactured goods.
“The manufacturing sector recorded robust growth, led by export-oriented industries, particularly E&E, amid strong demand linked to artificial intelligence and the continued expansion of the global technology cycle.
“Services also remained a key growth engine, with business-related activities gaining momentum. The information and communication technology segment benefited from the increasing operationalisation of data centres across the country,” he said, adding that stronger natural gas production helped the mining and quarrying sector return to positive growth.
“Domestic demand is expected to remain supportive in the coming quarters, with household spending benefiting from continued income growth and ongoing policy measures.
“Investment activity will be supported by multi-year private and public sector projects, the continued realisation of previously approved investments and the implementation of national development master plans,” he said.
Meanwhile, Abdul Rasheed said BNM also expects external demand to remain favourable, underpinned by sustained demand for E&E products as global investment in AI and technology infrastructure expands.
Further support is expected from recovering non-E&E exports, continued tourist spending and the expansion of Malaysia’s ICT services exports.
“The latest growth performance reinforces expectations that Malaysia could deliver economic growth near the upper end of its official forecast range in 2026, even as global trade and geopolitical uncertainties continue to cloud the external outlook,” he emphasised.
