The government anticipates robust economic growth in 2024, with a projected GDP increase of 4.0-5.0%. This optimism stems from steady domestic demand expansion and an external trade recovery. While inflation is expected to range from 2.1-3.6%, the government is considering a managed-float retail fuel pricing mechanism to stabilize fuel costs.
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Aligned Budget 2024 to Malaysia Plan
In public sector finance, the fiscal deficit is set to decrease to -4.3% of GDP in 2024, demonstrating a commitment to fiscal consolidation. The federal government’s debt-to-GDP ratio will remain below 65%, aligning with the 12th Malaysia Plan’s objectives.
Although not surprising to the equity market, the Bajet presents potential catalysts. The proposed 10% capital gains tax from March 1, 2024, could stimulate more listings, while tax exemptions for income from Islamic Securities Selling and Buying (ISBB) may enhance market volume. External factors, particularly US economic data and interest rate trends will continue to influence market sentiment.
