KUALA LUMPUR (Dec 10): RHB Research Institute Sdn Bhd  projects Malaysia’s real gross domestic product (GDP) growth to be sustained at a moderate 4.6% year-on-year (y-o-y) for 2019, just as in 2018 – amidst slowing global growth.

In a note today, the research house said the Malaysian economy eased further in 3Q18, and growth in 4Q is unlikely to be very strong, given the absence of a tax holiday boost as in 3Q.

“There is also limited room for an increase in fiscal spending, given the constraint.

“The overnight policy rate will likely be kept stable, but the ringgit may strengthen on the back of US Dollar weakness.

“Our currency strategist expects the MYR to recover to RM3.80 vs the USD, on the back of expected USD weakness following expectations that the US Federal Reserve could slow down its pace of rate hikes from its guided three times in 2019,” it said.

However, the research house said downside risks to this forecast have emerged, with the sudden drop in crude oil prices of late.