KUALA LUMPUR, AUG 14 — Malaysia’s economy expanded by 6 per cent in the second quarter of 2026, bringing first-half growth to 5.7 per cent.

Bank Negara Malaysia Governor Datuk Seri Abdul Rasheed Ghaffour said growth remained broad-based, supported by domestic demand and strong export performance.

“Both electrical and electronics (E&E) and non-E&E exports were growing, alongside support from ICT services,” Abdul Rasheed told a joint press conference here today.

The services sector grew 5.9 per cent, manufacturing 7.3 per cent, mining and quarrying 9.2 per cent, and construction 6.5 per cent, while agriculture contracted 3.7 per cent.

Private consumption increased 4.8 per cent, while private investment rose 4.3 per cent.

Abdul Rasheed said growth for the full year was expected to be around 5 per cent, although BNM would retain its existing 4 to 5 per cent forecast range for now.

“We have been experiencing growth that is above our expectation for the last three quarters. 

“Looking at the drivers, from consumption, investment, exports, tourism, and the rest, all these factors are driving growth still.

“Having said that, of course, there will be some challenges in the drivers of this growth itself and given the uncertainty, global economy, uncertainty on the geopolitical conflict, this may weigh on the growth,” he added. 

Abdul Rasheed said there would also be a base effect in the second half of the year, given that growth was 5.4 per cent in the second half of 2025.

Abdul Rasheed said BNM considered the latest growth performance to be broad-based, with the economy supported by domestic demand as well as the external sector.

The central bank’s figures also showed credit, debit card and e-money spending grew 17.1 per cent in the second quarter, while aggregate wages increased 5.5 per cent.

Real gross fixed capital formation grew 4.6 per cent during the quarter, with investment activity supported by continued spending on structures as well as machinery and equipment.

Abdul Rasheed said the strong growth did not point to excessive demand or an overheating economy.

“Demand is steady, but it’s not excessive,” he said.

He said the growth outlook remained subject to both upside and downside risks.

Among the upside risks were a de-escalation of the military conflict, continued strong demand for machinery and equipment, higher tourism arrivals and activities, and continued demand for ICT services.

On the downside, Abdul Rasheed said further escalation of the conflict and lower-than-expected production could weigh on growth.