Global economic growth is expected to slow further in 2023, subject to considerable uncertainties. Aside from ongoing concerns related to the pandemic, especially in China, the interplay between geopolitical fragmentation, elevated inflationary pressure, and the pace of monetary policy normalisation in major economies will be key determinants of the pace of global economic activities.
Meanwhile, developments in the global capital market are expected to be in tandem with this economic outlook. Malaysian economic growth is projected to continue in 2023, albeit at a more modest pace, reflecting an increasingly challenging global environment and the normalisation in domestic demand. The downside risks to growth remain given external uncertainties, while the pace of economic recovery will likely continue to be uneven across sectors.
The performance of the Malaysian capital market is projected to remain resilient, in line with the domestic economy. However, it will continue to be influenced by key global developments, with volatility expected to be driven by the rate of global monetary policy tightening and geopolitical developments. Nevertheless, conditions in the domestic capital market is expected to remain orderly, and continue to support the economy, underpinned by strong macroeconomic fundamentals and supportive capital market infrastructure
