Malaysia's leading forecaster cut its 2008 growth estimate to 5.4 percent from 5.8 percent on Wednesday, citing a shaky outlook for the United States and the global economy.

The independent Malaysian Institute of Economic Research (MIER) maintained its forecast of 5.7 percent expansion in 2007, but predicted a downturn the following year.

"This forecast is made on the assumption that there would be no recession in the US. However... there is the 30 to 35 percent chance that a recession will happen in the US," said MIER chief Mohamed Ariff Abdul Kareem.

"Figures indicate that Malaysia's growth in the second half is not going to get any better," Mohamed Ariff said.

Economists were upbeat despite the downgrade, saying that the domestic economy's fortunes remained bright and would be buoyed by a number of large government infrastructure projects.