Malaysia Q2 GDP Grows 5.8% as Tech Exports Boost Economy

Malaysia's economy expanded by 5.8% year‑on‑year in the second quarter of 2026, surpassing the 5.2% forecast. Growth was broad‑based, with the services sector leading and the technology export industry—particularly electronics and semiconductors—recording strong shipments. Domestic demand remained resilient, supported by household consumption, which helped offset external risks linked to global geopolitical tensions.

Research predicts Malaysian households will have purchasing power 18% higher than pre‑COVID‑19 2019 levels by 2026. Real wages are expected to rise around 2.8% annually, while inflation eases to about 1.9% for the year. Consumer spending is forecast to grow 4.2% year‑on‑year to RM1.10 trillion, with retail sales already up 7.2% in May 2026. High household debt—69.8% of GDP—remains a risk, but a stable overnight policy rate of 2.75% and a modest ringgit appreciation are expected to support debt servicing and import costs.