Malaysia: GDP growth disappoints in Q4
According to an advance estimate, GDP growth inched up to 3.4% year on year in the fourth quarter, from the 3.3% rise logged in the third quarter. Despite the acceleration, the result surprised markets on the downside. Additionally, the economy expanded 3.8% in 2023 as a whole, moderating notably from 2022’s 7.8% growth and missing Bank Negara Malaysia’s estimate of a 4.0% increase.
Rebounding mining and quarrying activity and firming agricultural production supported Q4’s slight uptick. Nevertheless, a slower rise in the services sector, weaker growth in construction activity and near-stagnant manufacturing output capped the rise. Decreasing exports, particularly to China, weighed further on the reading.
More detailed data will be released on 16 February.
UOB analysts commented on the outlook:
“For 2024, we expect higher growth […] on the back of a global soft landing scenario, lower global interest rates starting from mid-2024 and several positive domestic catalysts despite amid heightened uncertainties. […] This includes favorable labor market conditions, a pick-up in tourism activity, recovery in the technology and trade cycle, continuation of multi-year investment projects, realisation of investments approved and strategies outlined under the national master plans and blueprints.”