Malaysia’s economic outlook is expected to remain positive yet measured in 2026: DOSM

This observation comes in line with the developments in several industry-related components, particularly the real imports of semi-conductors (17.5%) and the real imports of other basic and precious & other non-ferrous metals (5.7%).

Malaysia's leading index (LI) showed positive momentum in January 2026, said the Department of Statistics, with an increase of 0.6% to reach 113.4 points (January 2025: 112.7). 

Chief Statistician Dr. Mohd Uzir Mahidin stated that the increase was in line with the developments in various industry-related components, particularly the real imports of semi-conductors (17.5%) and the real imports of other basic and precious & other non-ferrous metals (5.7%).

"On a monthly basis, the LI recorded a decline of 0.6% due to the less encouraging performance of the real money supply, M1 (-0.4%) and the Bursa Malaysia Industrial Index (-0.2%). The decrease reflects more cautious market sentiment in the short term," he added. 

On a positive note, Malaysia’s economic outlook is expected to remain positive yet measured, underpinned by continued domestic demand and controlled inflation. That said, ongoing global uncertainties—particularly geopolitical tensions and fluctuating oil prices— may influence import costs and exert pressure on inflation in the near term.

Meanwhile, the coincident index (CI), which tracks current economic conditions, increased by 5% to 131.3 points in January 2026, up from 125.1 points in the same month a year earlier.

The rise was driven by strong performance across all components, with notable double-digit growth in capacity utilisation in manufacturing (21.1%) and real contributions to the Employees Provident Fund (EPF) (18.4%). On a monthly basis, the CI strengthened by 0.9%, supported by higher real EPF contributions (0.4%), in line with improving employment activity and employee incomes.

READ MORE: Malaysia labour market stays resilient with 2.9% unemployment rate in January 2026

Infographics / DOSM 

Lead image / Malaysian Economic Indicators: Leading, Coincident & Lagging Indices publication for January 2026