Malaysia posts steady 5.3% growth in Q1 as domestic sectors anchor economy

THE country’s economy expanded by 5.3 per cent in the first quarter of 2026, maintaining a stable growth path despite mounting global uncertainties, according to advance estimates issued by the Department of Statistics Malaysia (DOSM).

The latest figures indicate a moderation from the 6.3 per cent growth recorded in the previous quarter, suggesting a gradual cooling in overall economic momentum.

On a quarter-on-quarter basis, however, economic activity contracted by 4.4 per cent, reversing a 3.3 per cent expansion in the final quarter of 2025 and signalling a short-term slowdown.

The expansion was largely driven by sustained performance across major sectors, with services, manufacturing, construction and agriculture continuing to support overall output, offsetting weakness in mining and quarrying.

The services sector remained the primary engine of growth, expanding by 5.4 per cent, albeit at a slower pace compared with the previous quarter.

Gains were led by wholesale and retail trade, alongside information and communication, as well as transportation and storage activities.

Manufacturing output grew by 5.8 per cent, easing slightly from earlier levels, supported by increased production in electrical and electronics, food processing, vegetable and animal oils and fats, and metal-related industries.

In contrast, the mining and quarrying sector recorded a contraction of 1.1 per cent, reflecting reduced output of crude oil, condensate and natural gas.

Agriculture growth moderated to 2.8 per cent from 5.4 per cent previously, weighed down by softer performance in rubber and fisheries, although oil palm and livestock segments continued to provide some support.

The construction sector remained resilient, expanding by 7.8 per cent, though at a slower pace than the 11.0 per cent recorded in the preceding quarter.

Growth was driven by continued activity across all segments, particularly in specialised construction and non-residential projects.

The Department of Statistics Malaysia said the official preliminary GDP data for the first quarter will be released on May 15, together with revised annual estimates.

Despite signs of softer momentum on a quarterly basis, the data underscores Malaysia’s ability to sustain growth through diversified economic activity and firm domestic demand, even as the external environment remains uncertain. - April 17, 2026