Exchange rate and FDI drive economic growth in Malaysia, inflation hinders
The article examines how real interest rates, exchange rates, inflation rates, and other factors affect economic growth in Malaysia from 1985 to 2017. They found that in the short term, a higher exchange rate, more trade openness, and foreign investment lead to economic growth. However, inflation and real interest rates can slow down growth in the short term. In the long term, a stronger exchange rate and more foreign investment help the economy grow, but high real interest rates can hinder growth. Overall, the government should focus on policies related to exchange rates and foreign investment to boost Malaysia's economic growth.