UBS: Asean-6 to grow by 4.9 pct this year

KUCHING (March 5): Asean 6 economies are projected to grow by about 4.9 per cent in 2026, reflecting steady expansion supported by resilient domestic demand and integration into global supply chains, according to UBS Investment Bank.

Senior Asean and Asia Economist at UBS Global Research Grace Lim said the region continues to benefit from deep integration into global manufacturing value chains and sizeable domestic markets.

“Conditions for growth remain in place, with household consumption driving momentum in Indonesia, an increase in private investment underway in Thailand and the Philippines, and resilient tech related export strengths in Singapore and Malaysia,” she said in a statement on Wednesday.

Her remarks were delivered at the 14th UBS OneASEAN Summit, which brought together over 850 institutional investors, policymakers and industry leaders to discuss investment trends for 2026.

UBS Global Banking head of South-East Asia & South Asia Nicolo Magni added that Southeast Asia remains a strategic alternative for investors.

“We expect strong deal making momentum to continue throughout 2026 and capital markets are likely to be more active in healthcare, real estate and consumer sectors,” he added.

The two-day summit covered global trade imbalances, investment opportunities in China, Japan and Europe, the outlook for gold and precious metals, the evolution of digital assets and artificial intelligence in ASEAN, as well as new energy systems to support an AI-driven economy.

For Malaysia, UBS has maintained its 2026 growth forecast at 4.8 per cent year-on-year.

Headline inflation is projected at 1.6 per cent, while core inflation has edged slightly above 2 per cent due mainly to administrative cost adjustments rather than broad-based demand pressures.

With inflation contained and growth near potential, UBS believes Bank Negara Malaysia has concluded its easing cycle and expects policy rates to remain unchanged through 2026.

Malaysia ended 2025 on a firmer footing, with final data showing fourth-quarter GDP growth revising up to 6.3 per cent year-on-year from an earlier estimate of 5.7 per cent, lifting full-year 2025 growth to 5.2 per cent from 4.9 per cent previously.

The upward revision was driven mainly by the services sector, which expanded 6.3 per cent in the fourth quarter, compared with the earlier 5.4 per cent estimate. Mining and agriculture also recorded modest upward adjustments.