Fitch Solutions Estimates Malaysia’s 2021 GDP at 0%; Economy to Stagnate in Remainder of 2021

Fitch Solutions predicts a stagnant economy for the rest of 2021 for Malaysia and revised down its Gross Domestic Product (GDP) growth forecast for 2021 to 0% from a previous forecast of 4.9%.

Why it Matters?

Despite Malaysia’s GDP expanding by 16.1% year-on-year (YoY) in the second quarter of 2021 (2Q 2021), the economy contracted 2.0% quarter-on-quarter (QoQ) in 2Q 2021. This was a result of the stringent national lockdown that was implemented till the 13th of August 2021. With real GDP growth figures falling well short of Fitch Solutions’ previous expectations, it seems even more likely that the third wave of COVID-19 infections will hinder Malaysia’s economic recovery further. Apart from government consumption, Fitch Solutions ex...