What risks could impact the global economic outlook?

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Global Economic Outlook Faces Potential Headwinds from Trade and Investment Restrictions

The global economic outlook, while showing signs of resilience and expected growth for 2025, is susceptible to significant downside risks stemming from an increase in trade and investment restrictions. These potential limitations on international commerce could introduce greater volatility into global financial markets and negatively affect economic growth trajectories worldwide.
Uncertainty Surrounding Trade and Investment Restrictions

A primary concern highlighted is the ongoing uncertainty regarding the potential for further trade and investment restrictions. Such measures, if implemented more broadly, could disrupt established supply chains and alter investment flows, thereby casting a shadow over the anticipated global economic performance for the coming year.
Elevated Policy Uncertainties Leading to Market Volatility

Beyond specific trade barriers, elevated policy uncertainties globally are also identified as a factor that could lead to increased volatility in international financial markets. This heightened uncertainty can make investors more cautious, potentially impacting capital allocation and the stability of asset prices across different economies.
Impact of Economic Slowdown in Major Trading Partners

For the Malaysian economy specifically, a significant downside risk lies in the possibility of an economic slowdown occurring in its major trading partners. Such a deceleration in key markets could directly reduce demand for Malaysian exports and affect investment, thereby dampening the nation's own growth prospects for 2025.

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What risks could impact the global economic outlook?

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