Malaysia’s Economic Growth Analysis

Investing.com — Malaysia’s economy experienced softer growth in the third quarter, with projections indicating subdued growth for the upcoming year due to a tight fiscal policy impacting demand.

According to a preliminary estimate released today, GDP growth declined to 4.8% year-on-year in the fourth quarter, down from 5.3% in the previous quarter. The consensus had predicted a growth of 5.2%.

Analysts from Capital Economics stated, “We think GDP growth should ease to 4.8% this year, down from 5.1% last year. With inflation likely to rise due to subsidy cuts, we believe the central bank will maintain interest rates at their current levels for the foreseeable future, including at the scheduled meeting next week.”

This preliminary estimate is based on data from the first two months of the quarter, though these figures may undergo significant revisions. Historically, the advanced estimate has been a reliable indicator of the final number.

A detailed expenditure breakdown will be available in a few weeks, but the production analysis indicates that the economy was mainly driven by robust growth in the services sector.

In contrast, growth in the manufacturing and construction sectors has slowed, while agricultural output has seen a decline.

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