Malaysia’s GDP grew 5.4% in 1Q2026, supported by household spending, investment and E&E exports, but momentum weakened sharply from 6.2% in the prior quarter. Monthly growth slowed to 4.1% by March, with private consumption and investment easing and seasonally adjusted GDP flat. Economists warn the 1Q reading may mask looming pain from the Iran war—higher costs, supply disruptions and weaker global demand—and see rising downside risks until the Strait of Hormuz reopens and conditions normalise.
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