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Malaysia’s business sentiment is reflected by a confidence indicator of +2.0%, driven by steady outlooks in the services, construction, and industry sectors.
On 27 May 2025, Department of Statistics Malaysia (DOSM) released its Business Tendency Statistics for the second quarter of 2025, based on the quarterly Business Tendency Survey.
This publication highlights expectations on business performance over the next three to six months. For the first time, this release includes the confidence indicator by state.
Dato’ Sri Dr. Mohd Uzir Mahidin, Chief Statistician Malaysia, noted that businesses continue to anticipate a favourable business environment. The overall confidence indicator of +2.0% reflects sustained optimism, although it is slightly lower than the +3.2% recorded in the previous quarter.
By sector, the services sector maintains a positive confidence indicator of +6.9% for Q2 2025, compared with +13.5% in the first quarter. The construction sector’s confidence indicator remains favourable at +4.6%, a decrease from +12.5% the last quarter.
The industry sector shows improved optimism, with the confidence indicator rising to +1.9% from +0.2% last quarter. In contrast, the wholesale and retail trade sector record a negative confidence indicator of -6.7%, reflecting a cautious business outlook, though this is a slight improvement from -8.1%.
Examining state-level confidence indicators reveals varied business prospects.
- Positive sentiment is observed in Johor (+1.5%), Kedah (+4.3%), Perlis (+3.5%), Terengganu (+18.0%), Wilayah Persekutuan Kuala Lumpur (+0.9%), and Wilayah Persekutuan Putrajaya (+3.7%).
- However, most states report pessimistic confidence indicators, including Kelantan (-7.8%), Melaka (-2.0%), Negeri Sembilan (-1.2%), Pahang (-4.5%), Penang (-5.1%), Perak (-6.3%), Selangor (-1.2%), Sabah (-0.3%), Sarawak (-2.9%), and Wilayah Persekutuan Labuan (-3.9%).
Looking ahead to the April-September 2025 period, overall business outlook remains positive with a net balance of +10.9%, a slight decrease from +11.9% in first quarter.
The services sector shows sturdy sentiment with a net balance of +18.3%, consistent with the previous quarter. The construction sector projects an optimistic net balance of +13.1 per cent as compared to +12.5% for the corresponding period, while the industry sector’s confidence indicator increases significantly to +12.0% from +6.8%. Meanwhile, the wholesale and retail trade sector continue to reflect subdued confidence regarding business expectations.
READ MORE: Malaysia launches centralised labour market data hub to support informed decision-making
Images / DOSM Facebook
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