Thursday 28 Mar 2024
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KUALA LUMPUR (Feb 14): The Malaysian economy, as measured by gross domestic product (GDP), grew 4.7% in the fourth quarter of 2018 (4Q18) from a year earlier as private sector activity remained the main driver of growth, while a rebound in exports of goods and services contributed towards net export growth, Bank Negara Malaysia (BNM) said today.

BNM said in a statement today full-year 2018 GDP growth stood at 4.7%. For 4Q18, the central bank said that on the supply side, major sectors continued to expand. The services sector was supported by continued strength in consumer spending, particularly in the retail segment, while growth in the manufacturing sector remained driven by the electronics and electrical and consumer-related clusters.

"Commodities-related sectors continued to recover from production disruptions experienced since the second quarter, with higher growth in the mining and agricultural sectors.

"Headline inflation declined to 0.3% (3Q18: 0.5%), mainly due to transport inflation turning negative. The combined outcome of the zerorisation of the goods and services tax and the implementation of the sales and services tax continued to exert an overall downward impact to headline inflation during the quarter," BNM said.

Going forward, the Malaysian economy is expected to remain on a steady growth path, according to the central bank.

BNM said private sector demand is expected to remain the main driver of growth amid continuing fiscal rationalisation while the external sector is likely to soften with moderating global demand.

Headline inflation is expected to average moderately higher, according to BNM.

"The impact of the consumption tax policy on headline inflation in 2019 will start to lapse towards the end of the year. Underlying inflation, which excludes the impact of the changes in consumption tax policy, is expected to be broadly stable in 2019 in the absence of strong demand pressure," it said.

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