KUALA LUMPUR (Oct 19): Malaysia’s export growth is expected to taper off in the fourth quarter this year as favourable base effects fade while renewed trade tensions are expected to weigh on trade momentum, said economists.
BIMB Securities maintained its 2026 export and import growth forecasts at 23.4% and 16.5%, respectively, expecting AI-driven semiconductor demand, data centre investments, resilient liquefied natural gas (LNG) exports and US tariff exemptions to support exports.
"...Growth is likely to moderate in 4Q2026 and into 2027," it said in a note after the release of the September trade growth data on Monday.
“In addition, tighter monetary policy in developed markets and higher long-term interest rates, reflected by elevated bond yields, could soften global consumption and investment demand,” BIMB added.
Malaysia’s latest export data exceeded economists’ expectations, driven by a sharp expansion in electronics shipments and stronger orders from key markets, including the US and China.
Exports rose 54.5% year-on-year to RM215.1 billion in September, according to data released by the Investment, Trade and Industry Ministry on Monday, surpassing the 39.9% growth forecast in a Bloomberg survey and accelerating from 45.5% in August.
Imports also exceeded expectations, climbing 52.7% year-on-year to RM181.4 billion, compared with the 39% growth forecast in the Bloomberg survey.
The stronger-than-expected trade export figure came as a surprise to Pantheon Macroeconomics, which had forecast a 33.3% expansion.
“For now, we see little evidence that sequential growth will slow further, but increasingly demanding base effects should eventually temper electrical and electronics (E&E) contribution to headline export growth year-on-year,” it said in a separate note.
MBSB Investment, RHB Investment raise full-year growth forecasts
Meanwhile, MBSB Investment Bank raised its 2026 export growth forecast to 32% and its import growth projection to 26%. By comparison, last year's export and import growth were at 6.6% and 6% respectively.
It expects sustained demand for E&E and technology-related products to support exports, alongside higher imports of inputs for manufacturing and investment activities.
"We expect trade growth to moderate towards year-end, while supply disruptions, elevated input costs, weaker final demand and renewed trade tensions remain key downside risks," said MBSB in its note.
RHB Investment Bank (RHB IB) also raised its 2026 export growth forecast to 34.4%, from 21.7%, citing robust year-to-date growth of 34%.
The research house expects E&E exports, a key driver of Malaysia’s strong export performance, to remain resilient for the rest of 2026, while commodity-related shipments, particularly LNG and petroleum products, should provide further support.
“We remain watchful of the uncertainties surrounding the sustainability of the AI investment cycle, geopolitical developments and US tariff policies, which could affect global demand and trade flows.
“Malaysia’s diversified economic base, deep integration into global and regional supply chains, and ongoing efforts to diversify export markets and broaden its product mix should help sustain export performance and cushion external headwinds,” RHB IB added in its note.