S&P Global Ratings Reduces its Growth Forecast of Malaysia in 2021 to 3.2% from 4.1%

S&P Global Ratings (S&P) has brought down Malaysia’s growth forecast to 3.2% in 2021 from its previous forecast of 4.1% in light of the economic conditions of the country at present.

Why it Matters?

The adverse impacts of the COVID-19 pandemic and the prolonged restrictions imposed to control it have affected the Malaysian economy more seriously than initially predicted. The services sector has been severely affected contributing to a rise in unemployment rates to 4.8% in June 2021 from 4.5% in May 2021. S&P expects private consumption and services sector to be impacted the most, mainly due to longer periods of lockdown in place. Balance sheets for households, small and midsize enterprises, banks and the overall economy will continue...