Bank Negara Malaysia has slashed its forecast for economic growth in 2021 in half, from 6% to 7.5% in May to 3% to 4% now. Based on the most recent analysis from Bank Negara, we think its recovery scenario is optimistic and the best among the three that we consider. This is the most likely, with a 60% probability, compared with 20% for the recovery scenario from Bank Negara. Finally, we differ with Bank Negara in our view of the effect of the vaccination programme. Given our forecast scenarios, the immediate priority must be to lift the lockdown — this is a prerequisite for economic survival, not just economic recovery.
