Malaysia’s Economic Growth in Q3

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Malaysia’s economy experienced a growth rate of 3.3% in the third quarter, driven by the strong performance of the services sector and domestic demand. This growth was in line with advance estimates released in October by Bank Negara.

Services Sector and Construction Industry Drive Growth

The services sector, which accounts for around 58% of GDP, recorded a significant growth of 5.0% year-on-year in the third quarter. Another contributing factor to Malaysia’s economic expansion was the construction sector, which saw a rise of 7.2%.

Improved Growth Compared to Q2

The final GDP figures for the third quarter surpassed expectations, with a growth rate of 3.3% compared to the 2.9% expansion recorded in the second quarter. Economists polled by The Wall Street Journal had initially predicted lower growth at 2.9%.

Economic Outlook and Inflation Projections

Bank Negara expects Malaysia’s economy to grow between 4% and 5% in 2024, emphasizing that this outlook is subject to both external and domestic risks. The central bank also anticipates that household spending will remain a key driver of growth, supported by improving income levels and a stronger job market.

In terms of inflation, Bank Negara projects an average range of 2.1% to 3.6% for next year. However, these projections are “highly subject” to factors such as domestic policy changes related to subsidies and global commodity prices.

Selected Economic Indicators from Bank Negara

The following table provides an overview of selected economic indicators released by Bank Negara:

| Indicator | Q3 | Q2 | |———————|———|———| | Gross Domestic Product | +3.3% | +2.9% | | Manufacturing | -0.1% | +0.1% | | Services Sector | +5.0% | +4.7% | | Mining Sector | -0.1% | +2.3% | | Agriculture Sector | +0.8% | -1.0% | | Construction Sector | +7.2% | +6.2% | | Private Sector Consumption | +4.6% | +4.3% | | Public Sector Consumption | +5.8% | +3.8% |

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