KUALA LUMPUR: Despite the energy supply shock, Malaysia’s economy remains well on track to grow by 4% to 5%, likely towards the upper end of the range, with manageable inflation in 2026, Bank Negara Malaysia (BNM) governor Datuk Seri Abdul Rasheed Ghaffour said.
Malaysia’s economic fundamentals, reform agenda and commitment to sound economic management have enabled the government to respond when shocks occur.
“As the country’s central bank, BNM has played its part by preserving the macroeconomic stability that allowed reforms to take hold, he added.
“Low and stable inflation, a sound financial system and orderly financial markets have helped create the conditions conducive to economic transformation,” Abdul Rasheed said in his keynote address at the opening of the two-day Sasana Symposium 2026 (SS2026) here today.
Themed “Reforms for Resilience: Navigating Uncertainties”, SS2026 features discussions on key economic and financial issues, including economic resilience, wages, cost of living challenges, investments, energy security, Islamic finance and private healthcare costs.
Abdul Rasheed said that last year, Malaysia’s economy expanded 5.2%, inflation remained contained and the ringgit was the region’s best-performing currency.
On Malaysia’s fiscal position, he said its fiscal deficit narrowed to 3.7% of gross domestic product (GDP) in 2025 from 6.2% of GDP in 2020.
“This has helped rebuild policy space at a time when demand for public resources continues to increase,” he said.
As Malaysia enters its next phase of development, he said the financial system must also evolve alongside it into one that is guided by values, creates meaningful impact and acts with responsibility.
He said BNM’s upcoming Financial Sector Blueprint 2026-2031 will be guided by three aspirations: finance for a more resilient society, finance for a more prosperous society and a future-proof financial system.
Meanwhile, Abdul Rasheed said future economic growth must be sustainable, noting that Malaysia is one of the world’s 17 most biodiverse nations and that the country’s natural wealth is every bit as precious as its economic wealth.
On fiscal reforms, he said sustainable public finances sit at the heart of almost every national policy, as better education, stronger healthcare, modern infrastructure, climate resilience and effective social protection all depend on the government’s fiscal capacity.
Looking ahead, Abdul Rasheed noted that Malaysia’s medium-term outlook remains favourable.
“Growth is expected to stay firm, while inflation remains manageable. We will continue to do what is needed to maintain price stability in a manner that supports sustainable economic growth,” he said.
On another issues, the central bank governor said Malaysia’s successful US$1.5 billion (RM6.1 billion) global sukuk issuance last week shows investors’ confidence in its economic fundamentals.
He said the response to the issuance was exceptionally strong, with demand reaching nearly five times the amount offered.
“Investors were not only willing to commit capital to Malaysia. They were willing to do so on very favourable terms, with record-low spreads.
“It was a clear vote of confidence in Malaysia’s economic fundamentals, our reform agenda and our commitment to sound economic management,” he said in his keynote address.
Meanwhile, Abdul Rasheed said Malaysia has approved RM815 billion in investments over the last two years, equivalent to almost half of its annual gross domestic product, which could create close to 245,000 jobs if fully realised.
“A sizeable number of them are expected to be higher-skilled roles. Yet creating jobs is only half the equation. Malaysians must also have the skills to step into them,” he said, adding that at present, more than two-thirds of Malaysians continue to be employed in low-skilled or mid-skilled roles.
However, he said Malaysia has already seen encouraging signs, with the share of high-skilled employment increasing from 27.5% in 2019 to 30.1% in 2025.
“This progress may seem gradual, but structural shifts in the labour market rarely happen overnight. Creating higher-skilled jobs at scale takes time,” he said.
Abdul Rasheed said that as technology and artificial intelligence reshape industries, the days of learning a skill once and relying on it for a lifetime are over, and workers will need opportunities to upskill and reskill throughout their careers continuously.
The event also saw the launch of iTekad Employment, the latest programme under BNM’s iTekad social finance initiative, which supports individuals from vulnerable communities to secure stable employment and income.
