0739 GMT - Malaysia could see inflation risks rising from escalating Middle East tensions and disruptions in the Strait of Hormuz, though price pressures remain modest so far this year, UOB economists Julia Goh and Loke Siew Ting say in a note. Spillover effects on food, transport and services could lift inflation from March if the conflict persists, they say. While the full economic impact remains uncertain, Malaysia's GDP growth is supported by the ongoing AI upcycle, while higher energy costs and shipping delays may weigh, they say. With inflation seen largely supply-driven, Bank Negara Malaysia could keep the policy rate unchanged at 2.75% until there is a material shift in global or domestic conditions, they add. UOB maintains its 2026 Malaysia's inflation estimate at 2.0% for now, as the situation remains fluid. (yingxian.wong@wsj.com)
(END) Dow Jones Newswires
March 19, 2026 03:39 ET (07:39 GMT)
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