KUALA LUMPUR: MIDF Research expects Malaysia's economic growth to average at 6.0 per cent in 2022, on the back of strong external sector, elevated commodity prices and robust domestic demand.
The firm said even though there was food inflation spike risk, overall price pressure was expected to remain stable amid current capped retail fuel prices for RON95 and diesel.
"As long as average headline inflation does not surpass 3.0 per cent year-on-year (yoy), we believe domestic spending will stay on an upward trajectory for this year and 2023," it said in a note.
S&P Global Ratings has revised Malaysia's sovereign credit ratings' outlook to stable from negative, projecting gross development product (GDP) to grow 6.1 per cent this year.
MIDF Research said the steady growth momentum was supported by strong exports, high commodity prices and domestic demand following the reopening of the economy.
In addition, the firm said S&P also affirmed the "A-" for long-term and 'A-2' for short-term foreign currency sovereign credit ratings as well as Malaysia's 'A' for long-term and 'A-1' for short-term local currency ratings.
"The 2022 forecast and optimistic view given by the global rating agency is in line with our outlook assessment.
"It shows Malaysia's economic growth to average at 6.0 per cent on the back of strong external sector, elevated commodity prices and robust domestic demand," it added.