Malaysia’s economic growth gained speed and exceeded expectations in the third quarter with strong upward contributions from domestic consumption and investment, while exports acted as a drag. <\/p>\n
Gross domestic product expanded 3.3 percent after rising 2.9 percent in the second quarter, the Bank Negara Malaysia reported Friday. GDP was forecast to climb 3.0 percent.<\/p>\n
On a quarter-on-quarter basis, economic growth strengthened to 2.6 percent from 1.5 percent in the preceding period.<\/p>\n
Private consumption advanced 4.6 percent annually. Driven by increased supplies and services spending, public consumption rose 5.8 percent. <\/p>\n
Private and public investment grew 4.5 percent and 7.5 percent, respectively. <\/p>\n
Due to weaker external demand for goods and lower commodity prices, gross exports plunged 15.2 percent. Likewise, gross imports decreased 16.3 percent reflecting weaker intermediate imports. <\/p>\n
In the first three quarters of 2023, the economy<\/span> expanded 3.9 percent from a year ago.<\/p>\n BNM Governor Datuk Abdul Rasheed Ghaffour said the economy is set to grow around 4 percent in 2023 and 4-5 percent in 2024 despite the challenging global environment.<\/p>\n “Growth will continue to be driven by the expansion in domestic demand amid steady employment and income prospects, particularly in domestic-oriented sectors,” the governor said.<\/p>\n This growth performance along with other favorable economic developments would provide support to the ringgit, said Ghaffour.<\/p>\n Capital Economics economist Gareth Leather said the strength in economic growth is unlikely to last amid elevated interest rates and struggling exports. <\/p>\n The economist added that the economy will grow at a below-trend pace in the near term before picking up in the second half of the next year. <\/p>\n Regarding prices, the central bank said inflation is set to continue to ease over the remainder of 2023. Headline inflation is expected to average between 2.5 percent and 3 percent this year.<\/p>\n In the third quarter, headline inflation softened to 2 percent from 2.8 percent a quarter ago. At the same time, core inflation slowed to 2.5 percent from 3.4 percent.<\/p>\n The unemployment rate declined further in the third quarter to 3.4 percent from 3.5 percent a quarter ago.<\/p>\n The current account posted a surplus of 2.0 percent of GDP compared to 2.1 percent in the second quarter. <\/p>\n