0821 GMT - Malaysia is better cushioned than many regional peers to deal with the fallout from the conflict in the Middle East, UOB economists Julia Goh and Loke Siew Ting say in a note. They note that Malaysia is mainly exposed to the conflict through three channels--energy costs, trade and inflation. A multi‑month disruption could require coordinated fiscal measures, supply-chain support and inflation management to protect growth and households, they say. As the situation has been ongoing for less than two weeks, UOB maintains its baseline outlook, with 2026 GDP growth expected at 4.5%, inflation at 2.0% and the fiscal deficit at 3.5% of GDP. Bank Negara is expected to keep policy rate at 2.75%, but policymakers may adjust subsidies and energy strategies if disruptions extend beyond a month, UOB adds. (yingxian.wong@wsj.com)

(END) Dow Jones Newswires

March 12, 2026 04:21 ET (08:21 GMT)

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